10-K
US AIRWAYS GROUP INC filed this Form 10-K on 02/20/2013
Entire Document
<< Previous Page | Next Page >>
Table of Contents
Express Operations
Certain air carriers have code share arrangements with us to operate under the trade name “US Airways Express.” Typically, under a code share arrangement, one air carrier places its designator code and sells tickets on the flights of another air carrier, which is referred to generically as its code share partner. US Airways Express carriers are an integral component of our operating network. We rely heavily on feeder traffic from our US Airways Express partners, which carry passengers to our hubs from low-density markets that are uneconomical for us to serve with large jets. In addition, US Airways Express operators offer complementary service in our existing mainline markets by operating flights during off-peak periods between mainline flights. During 2012, the US Airways Express network served 157 airports in the continental United States, Canada, Mexico and the Caribbean, including 78 airports also served by our mainline operation. During 2012, approximately 28 million passengers boarded US Airways Express air carriers’ planes, approximately 44% of whom connected to or from our mainline flights. Of these 28 million passengers, approximately 8 million were enplaned by our wholly owned regional airlines Piedmont and PSA, approximately 20 million were enplaned by third-party carriers operating under capacity purchase agreements and less than 1 million were enplaned by carriers operating under prorate agreements, as described below.
The US Airways Express code share arrangements are in the form of either capacity purchase or prorate agreements. The capacity purchase agreements provide that all revenues, including passenger, mail and freight revenues, go to us. In return, we agree to pay predetermined fees to these airlines for operating an agreed-upon number of aircraft, without regard to the number of passengers on board. In addition, these agreements provide that certain variable costs, such as airport landing fees and passenger liability insurance, will be reimbursed 100% by us. We control marketing, scheduling, ticketing, pricing and seat inventories. Under the prorate agreements, the prorate carriers receive a prorated share of ticket revenue and pay certain service fees to us. The prorate carrier is responsible for pricing the local, point to point markets to the extent that we do not have competing existing service in that market. We are responsible for pricing all other prorate carrier tickets. The prorate carrier is also responsible for all costs incurred operating the aircraft. Our prorate carrier, Trans States Airlines, Inc., operated three regional jets and SkyWest Airlines, Inc. operated one regional jet under a prorate agreement at December 31, 2012. All US Airways Express carriers have logos, service marks, aircraft paint schemes and uniforms similar to our mainline operation.
The following table sets forth our US Airways Express capacity purchaseagreements and the number and type of aircraft operated under those agreements at December 31, 2012.
Carrier
Number and Type
of Aircraft
PSA (1)
49 regional jets
Piedmont (1)
44 turboprops
Air Wisconsin Airlines Corporation
70 regional jets
Republic Airline, Inc. (“Republic”)
58 regional jets
Mesa Airlines, Inc. (2)
38 regional jets
SkyWest Airlines, Inc.
14 regional jets
Chautauqua Airlines, Inc. (2)
9 regional jets
(1) PSA and Piedmont are wholly owned subsidiaries of US Airways Group.
(2) In February 2013, we executed an amendment to our capacity purchase agreement with Chautauqua which removes the nine Embraer 145 regional jets they currently operate from our express fleet by July 2013. In addition, we executed an amendment to our capacity purchase agreement with Mesa Airlines to add nine CRJ 900 aircraft.
9
<< Previous Page | Next Page >>
