For legacy carriers, the average CASM was 10.12. US would need to cut costs by another 9% or so to reach just the average for legacy carriers -- then, when you take their financial position relative to Delta, Continental, Northwest, etc., into consideration, their CASM needs to be much lower than this to be truly long-term competitive. I don't think that we'd see year over year reductions in CASM of 20% or so, which is what would be required. Only two airlines posted 10+ percent reductions, and none of them were legacy carriers.
Aaron's right. Yes, US Airways survived 2002, but just barely. And after Siegel's cost-cutting wizardry, US still has a Cartel-high CASM? Even the second round of wage cuts, spurred by Bronner's early-December Chapter 7 threat, if ratified, won't put US Airways anywhere near a Cartel-low (8.9 to 9.5 cents) CASM that some forum members have confidently predicted.
As I noted often during the past 3 months (and which my critics here failed to notice), it is indeed no longer impossible for US Airways to survive. But it's still a long shot. In the next three months alone, US must survive: winter, Round II with Saddam (probably), and David Bronner's impatience.
Also, US should not expect to ever get close to its rapine 1990's yields in the Northeast, if they do survive. Business and leisure travelers remained much stingier in 2002 than was widely forecast at the beginning of the year. That's because, as I remain confident, a sea change has occurred in the market's tolerance for high fares. US will need to get down to 8.9-9.5 cents CASM if they want to endure in the Northeast. Although anything seems possible these days, I still don't see that happening in time to save them.
Need a new airline paint scheme? Better call Saul! (Bass that is)