Most troubling about the latest loss: Revenue loss accelerated in the 2nd quarter. This makes me believe that customers also have no confidence in the financial stability of the airline and are buying tickets elsewhere for fear of US going under. I believe, despite the loss of jobs, that the country would be best served by letting US go under. There just isn't enough that can be done fast enough to save this airline. The $900 million will just stop the bleeding for a year at most.
[from reuters, unessenital information deleted]
After posting a massive increase in second quarter net losses, US Airways sources have warned that the airline may yet have to file for bankruptcy protection unless its financial problems are resolved.
The carrier lost USD$248 million against USD$24 million in the same period last year. Revenue dropped from USD$2.49 billion in 2001 to USD$1.9 billion this year.
The company said that as a result of previously announced payment deferrals related to aircraft lessors and lenders it is currently in default on certain public and private debt obligations.
The success of its restructuring program is crucial to US Airways future as it seeks to win concessions from its employees and meet the requirements for a USD$900 million federal loan guarantee for which it has won conditional approval.
The airline, which has reduced capacity by 20 percent, saw second-quarter traffic fall by 19 percent. Operating loss for the first half of the year was USD$545 million, compared to USD$208 million for the first six months of 2001.
Firings, if well done, are good for employee morale.