flashmeister
Posts: 2671
Joined: Fri Apr 28, 2000 4:32 am

USAirways Defers Payments On Older Aircraft

Tue Jun 25, 2002 12:51 pm

Press release at http://biz.yahoo.com/prnews/020624/dcm045_1.html.

Excerpts from the release:

The payment deferrals are focused principally on aircraft lessors and lenders, all of which have been notified, including aircraft that have already been grounded and selected older Boeing aircraft in service that have been targeted as part of the restructuring plan.

The Company said that the payment deferrals do not involve any public debt obligations or payments related to its Airbus aircraft fleet, all of which are current and which the Company presently intends to continue to pay in the ordinary course of business.

The Company said that it was otherwise paying its day-to-day obligations and did not anticipate any impact to its customers, employees, airports or other operations. The Company also said that the strategic lessor/lender and vendor payment deferral initiatives were not linked to the Company's current cash position.

The Company acknowledged the possibility that it may receive notices of default which could eventually lead to cross-defaults under agreements with other lessors, vendors and creditors. Such cross-defaults could lead to an acceleration of payment demands by the Company's creditors, which if not rescinded, could require the Company to implement its restructuring plan though a Chapter 11 bankruptcy reorganization.

-----

Not good news from Crystal City. I can't see how anyone at US could feel good about this. First, ask for a loan, then ask to delay paying off earlier loans... sounds like they don't intend on making money for a very long time.

How many other people would be allowed to run up their credit cards to the limits, get a bank-guaranteed loan, and then stop paying some of their oldest bills? Precious few...

Anyone care to hum along with me as we watch more deck-chair arranging on the Titanic of the skies?
 
DCA-ROCguy
Posts: 3893
Joined: Fri Apr 21, 2000 5:03 am

RE: USAirways Defers Payments On Older Aircraft

Tue Jun 25, 2002 1:25 pm

US Airways should *not* be granted a federally-guaranteed loan. Market forces should be allowed to break US up among the other Cartel carriers when it goes under. Industry economics and DOJ have ensured that it will be a breakup and not a megamerger.

Every time I drive by DCA and see a yellow Midway Airlines tail (a big 73G), it annoys me, because they were not a viable business before 9/11, and will probably wind up shuttered again before too long. Your tax dollars at work.

Jim
Need a new airline paint scheme? Better call Saul! (Bass that is)
 
co/ba
Posts: 388
Joined: Tue May 22, 2001 1:55 pm

RE: USAirways Defers Payments On Older Aircraft

Tue Jun 25, 2002 1:57 pm

US will not get the gurantees
 
LoneStarMike
Posts: 2802
Joined: Sat Jul 01, 2000 1:02 pm

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 2:27 am

This thread over at USAviaion.com doesn't bode well for US Airways, either.

LoneStarMike

 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 2:41 am

Dave Siegel took a big bit of s$!t sandwich when he accepted the USAirways job. I'm curious what he thinks will actually happen here.
 
ouboy79
Posts: 4113
Joined: Sun Nov 18, 2001 1:48 pm

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 4:02 am

If you read the discussion on USAviation, you will notice the aircraft in question here are the F-100s and 767s. The F-100s are no longer flying and are just collecting dust in the desert; the 767s are still being used...however, this is the widebody fleet type that they want to eliminate. Unlike those before who would think that the 330s were going, sorry the 76s are goners.

This is all positioning to make the reorganization work. Nothing more...nothing less. U will get the loan and will be a viable stand alone carrier with a partner in a domestic alliance -- Northwest along with KLM.
 
flashmeister
Posts: 2671
Joined: Fri Apr 28, 2000 4:32 am

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 4:06 am

Interesting about the engines/tail# matchups that are in progress, although I agree that this is just prudent preparation...

But that signals that people in Crystal City know that they have to prepare for this, and it doesn't sound like they're wasting any time with it. How big of a hit would it be to US operations if they parked the 73x fleet? I'm not as up on their fleet as I used to be...

-Aaron
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 4:47 am

 
donder10
Posts: 6944
Joined: Sun Oct 21, 2001 5:29 am

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 4:58 am

Dave Siegel took a big bit of s$!t sandwich when he accepted the USAirways job. I'm curious what he thinks will actually happen here
Lol,I like that!What is Siegel's record in previous jobs?What is US'debt?
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 5:16 am

Dave Siegel was president of Continental Express and then CEO of Avis Rent-a-Car. He was held in high regard at CoEX. I know someone who works there. CoEX has done pretty well. I don't how he did at Avis.
 
ouboy79
Posts: 4113
Joined: Sun Nov 18, 2001 1:48 pm

RE: USAirways Defers Payments On Older Aircraft

Wed Jun 26, 2002 8:58 pm

If a lawsuit over 3 old MD-80s is an iceberg...U has nothing to worry about.

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