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TTraider95
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Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:03 am

Hello everybody,

I was going through some random pages in the back catalog of this forum from 2004-2005 and, one consistent topic that kept coming up was U.S. Airways was on its deathbed and it was days away from shutting down. I knew they were having some serious financial problems but, I didn't know it was that bad.

So, was U.S. Airways really close to shutting down or was it the usual Civil Aviation forum where things got blown way out of proportion?

Thank you!
 
Max Q
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:29 am

Pretty close I think


They certainly weren’t a sustainable stand alone operation


Their reputation for customer service was awful and rightfully so



The merger with AA really saved them
The best contribution to safety is a competent Pilot.


GGg
 
mga707
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:31 am

The merger in 2006 was with America West Airlines, not AA!
 
DTWLAX
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:34 am

Didn't US Airways try to buy Delta in early 2007? I believe they tried it twice within a couple of months but failed on both occasions.
DL was under Chapter 11 at that time.
 
727LOVER
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:36 am

Max Q wrote:
Pretty close I think


They certainly weren’t a sustainable stand alone operation


Their reputation for customer service was awful and rightfully so



The merger with AA really saved them


He said 2004-2005. The merger with HP really saved them Afterword, the were profitable.
"We must accept finite disappointment, but never lose infinite hope." - Martin Luther King, Jr.
 
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DUDEofJETS
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:45 am

So America West and US Airways merged in 2005.

At that time US Airways was worse off as they were in bankruptcy, but Am West was struggling. Am West was looking at merging with a few different carriers but this was NOT the merger with AA. with the merger US Airways was able to come out of BK we took the US Airways name, but almost all of the top management was America West.

The merger with AA was completed in July of 2015.

Hope that helps!
 
BAeRJ100
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 4:04 am

DUDEofJETS wrote:
So America West and US Airways merged in 2005.

At that time US Airways was worse off as they were in bankruptcy, but Am West was struggling. Am West was looking at merging with a few different carriers but this was NOT the merger with AA. with the merger US Airways was able to come out of BK we took the US Airways name, but almost all of the top management was America West.


Yep. My understanding is that, essentially, America West was the surviving carrier, but they took the US Airways name. They did ditch the HP designator in favor of US, but retained their old ICAO code (AWE) and callsign (Cactus).
B737/738/739/744ER/752/753/763/77L/77W/788/789
A223/320/321/332/333/346/359/388
MD82/MD88/717/F100/RJ85/RJ100/146-100/200/300
E175/190/CRJ700/900
 
Runway28L
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 4:08 am

DTWLAX wrote:
Didn't US Airways try to buy Delta in early 2007? I believe they tried it twice within a couple of months but failed on both occasions.
DL was under Chapter 11 at that time.

Late 2006 is when US made a $8 billion bid for DL. Here's an article straight out of the time machine.

http://money.cnn.com/2006/11/15/news/co ... /index.htm

UA also tried merging with US in May 2000. The DOT however threatened to sue and the deal was killed off in July 2001.

http://abcnews.go.com/Business/story?id=87893&page=1
 
deltalaw
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 4:19 am

Isn’t it funny how quickly times change in the airline world? 2018...DL’s market cap is nearly what UA and AA are COMBINED! Doug Parker trying to buy DL and the “Keep Delta my Delta” stickers and buttons seem so long ago.
 
xxcr
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 4:39 am

Runway28L wrote:
DTWLAX wrote:
Didn't US Airways try to buy Delta in early 2007? I believe they tried it twice within a couple of months but failed on both occasions.
DL was under Chapter 11 at that time.

Late 2006 is when US made a $8 billion bid for DL. Here's an article straight out of the time machine.

http://money.cnn.com/2006/11/15/news/co ... /index.htm

UA also tried merging with US in May 2000. The DOT however threatened to sue and the deal was killed off in July 2001.

http://abcnews.go.com/Business/story?id=87893&page=1



So happy that UA didn't merge with US air. People complain how bad UA is, imagine if they had merged with US air.......US AIR was the worst airline, their customer service, In flight service, and airport experience was terrible. Even UA was better.
 
Max Q
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 6:07 am

mga707 wrote:
The merger in 2006 was with America West Airlines, not AA!



My mistake, you are correct, I was referring to the combination of US/HP merging with
AA later on
The best contribution to safety is a competent Pilot.


GGg
 
tpaewr
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 6:39 am

There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting
 
Boof02671
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 6:49 am

No chance in 2004/05 I was on the IAM Mechanic and Related Negotiating Committee.

Now in the 2002/03 right before Christmas they threatened us with chapter 7.
 
Passedv1
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 7:38 am

tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.
 
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EA CO AS
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 8:02 am

Passedv1 wrote:
tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.


Not during the very late 90s to mid-2000s they weren't - they were at the top of their game.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
Max Q
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 10:07 am

EA CO AS wrote:
Passedv1 wrote:
tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.


Not during the very late 90s to mid-2000s they weren't - they were at the top of their game.




We certainly were



Then UA came along...
The best contribution to safety is a competent Pilot.


GGg
 
SteelChair
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 10:18 am

Leadership matters. I attribute that short sweet spot that CO hit entirely to Gordon Bethune.

Imho some of the mood that was created was use of statistics and media, it was never really THAT good, but the is no denying that they did improve their game considerably. Just mho.
 
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jfklganyc
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 10:20 am

I believe pretty close.

The industry, as a whole, would have recovered quicker...but a whole lot of people would have lost their jobs.

Plus, the political implications of letting a US carrier shutdown due to after effects of 9/11 were not palatable to an administration trying to show stength and resolve to a jittery country.

The result was a quick merger and prolonged bk carwashes that reshaped and effected the entire industry.

Sadly, a new precedent was set. If you are a large carrier now, there is almost no chance they will let you die...even if it is for the greater good.
 
MIflyer12
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 11:07 am

TTraider95 wrote:
Hello everybody,

I was going through some random pages in the back catalog of this forum from 2004-2005 and, one consistent topic that kept coming up was U.S. Airways was on its deathbed and it was days away from shutting down. I knew they were having some serious financial problems but, I didn't know it was that bad.

So, was U.S. Airways really close to shutting down or was it the usual Civil Aviation forum where things got blown way out of proportion?

Thank you!


Look at the Business pages of the time (Wall Street Journal, New York Times) and look for references to cash balances and difficulty obtaining new financing, Debtor-in-Possession (DIP) or other. Plenty of U.S. carriers have spent lots of time in Chapter 11 reorganization and conduct daily ops just fine. United operated under Ch 11 for almost 38 months -- 12/9/2002 to 2/1/2006.
 
MIflyer12
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 11:18 am

EA CO AS wrote:
Passedv1 wrote:
tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.


Not during the very late 90s to mid-2000s they weren't - they were at the top of their game.


CO had already been Chapter 11'd TWICE when Bethune got there, in '83 and '90.
 
MO11
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 1:55 pm

BAeRJ100 wrote:
Yep. My understanding is that, essentially, America West was the surviving carrier, but they took the US Airways name. They did ditch the HP designator in favor of US, but retained their old ICAO code (AWE) and callsign (Cactus).


Actually, ICAO was intended to remain "USA" which was used for one or two days following FAA certificate integration. USA/Cactus became too confusing for ATC.
 
drdisque
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 2:40 pm

It's also worth mentioning that America West found the complexity of US's East Coast network very overwhelming. There WERE good routes that didn't touch PHL, CLT, or DCA, but US' new management decided to focus on those three hubs to simplify the operation. At the time US flew numerous other routes, mostly express out of BOS, had the PIT hub, and the FLL focus city. They also had the LGA focus city which US kept for awhile until DL coughed up enough money for it (they obviously weren't just going to abandon a fairly large operation at LGA).
 
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enilria
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 2:45 pm

TTraider95 wrote:
Hello everybody,

I was going through some random pages in the back catalog of this forum from 2004-2005 and, one consistent topic that kept coming up was U.S. Airways was on its deathbed and it was days away from shutting down. I knew they were having some serious financial problems but, I didn't know it was that bad.

So, was U.S. Airways really close to shutting down or was it the usual Civil Aviation forum where things got blown way out of proportion?

Thank you!

Not close. Large airlines don't shutdown. Even Frontier which was much more superfluous to the national airspace system found Ch11 financing. Airlines with $100s of millions of dollars in slots that have to be operated to be retained aren't going to just shut down. It was just a question of what financial rescue deal was going to win or what assets were going to be moved to who.
 
TWFlyGuy
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 2:50 pm

I remember sitting next to a US pilot who was commuting back home and he was telling me he never used to bring his flight bag (the wide briefcases pilots used to have) home with him. About two weeks before that flight he was saying that the managers were even telling them to bring their stuff home and not leave personal items just in case. Everyone was pretty resigned to their fate. The HP-US merger is probably the one that made the most sense. Both carriers were pretty weak although HP was more stable at the time. HP was almost entirely West Coast vs US being almost entirely east coast. Bringing them together was a case of 1+1 = 3. The combined carrier brought more utility to the customer than either did standing alone.
 
tpaewr
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:07 pm

Passedv1 wrote:
tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.



Your missing the timeline. CO troubles were in the 80s and early 90s. We are talking 2000s. CO was largely seen as the best of the US major from the Bethune era till the eve of the merger.

https://www.elliott.org/blog/is-contine ... y-carrier/
 
Flighty
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:09 pm

US was very close to shutting down. Even people at the director level thought it was 50/50. Management and unions had been at loggerheads over $$ problems, overcapacity and legacy pensions (the same reason generally all legacies declared bankruptcy). They were playing professional chicken, each threatening to shut the company down. US was approaching total cash starvation, the point beyond which you cannot operate. Then the baggage crisis at end of 2004 flared up, and nearly brought the house down. ALPA pilots realized things had gotten more dire than they ever intended. They were out on the ticket floor of PHL serving coffee to customers. US was in a weaker position than say Northwest because the unions were more angry, the furloughs had been bigger and the business wasn't as healthy.

But the there were factors in its favor. The business was viable under the right structure. The hubs weren't bad. PHL, CLT DCA. They later sold off the weak LGA operation, but otherwise, today the East US operation survives and does well for AA. PHX does fine for AA too. Also recall that US had the most numerous Airbus fleet in the world at that time. If they shut down, it would have upset residual values. This made Airbus sit up and deal directly with US on some more orders and a cash infusion. Others did too. Air Wisconsin parent put in money. Republic.

Both US and HP had regional networks and mgmt vs union cash crunch issues. US would have liquidated sooner than HP, but US's fundamental business was likely stronger than HP. During bankruptcy, US was cutting the operation, de-hubbed PIT, returned airplanes and slashed employee count, pay and benefits. They sent back a ton of airplanes. In early 2005, US and HP management got together to fix the regional network issue, which they both had, realizing they were could be "stronger together." They cleverly used the merger to cut costs and get rid of US's legacy infrastructure that it could not afford.

The results after the HP-US were good. Reservation cutover was a snafu but they got past it. For an airline with "no good hubs" and "no good planes" (not to mention the employees weren't celebrated either - except Sully) they made consistent profits and regained true stability from what had been a terribly weak hand. This is what put Doug and team in a position to run AA.
 
PI4EVER
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 3:53 pm

Thank you Flighty for keeping the discussion on topic and not debate any other airline and their unrelated issues. This is about USAirways.
Flighty also spoke from obvious experience in some form with US and was right on in his assertion US was near cash starvation and shutdown.
It was felt within it was literally days away from a full shutdown and liquidation a la Braniff, Eastern or Pan Am.
There had been a continuing drain on cash and revenue flow from lingering effects of the aircraft accidents dating back to 1989. We were nicknamed "USScareways." Competition, a splintered network of service, employee morale was at it lowest and it reflected in the service provided to the customer. The company defaulted on the pension fund, cut medical benefits to retirees across the board and implemented a stringent cost cutting program to reduce loss of cash flow, that included furloughs and consolidation of operations that affected airport and reservation staff across the system. US was attempting to "rearrange the deck chairs on the Titantic" in addition to the common saying "We continue to succeed in spite of ourselves." It was a dire situation that did not improve. CEO David Seigel abruptly left with a $8 million cash buyout and went to Hertz. The on-going union issues and cost cutting initiatives continued with the management team that ultimately in short order saw HP come in with the merger proposal. US essentially became America West, but the USAirways name was kept as more universally known, even with a poor reputation, than America West marketing itself successfully east of the Mississippi and in Europe. There are employees today at AA that are grateful for Douglas Parker and his team for saving this airline. The legacy of US is not that it merged/bought out/took over AA, but literally survived and subsequently became a relatively profitable and successful by " sheer grit" airline operation.
The debate on this forum is usually negative about any reference or conversation about USAirways. At the end of the day this airline did survive and thanks in large part to a large group of dedicated employees who lived and worked day-to-day with an uncertain future. There were a lot of great people at US and a fair share of not so great, but that is human nature. Not every person is a dedicated employee at their chosen field of work.
The final merger of 1989 with PI and PS ultimately fed the financial losses that occurred for decades. Competition in the 1990's with a growing and popular Southwest had a big impact, and of course we all know the effects of 9/11 that changed the landscape of airline travel and service forever.
There are many of us former US employees who went on to other careers and successful retirements who are proud of the work we performed at US and our efforts to make it a successful airline we were proud of even in the face of adversity.
And yes. I am a proud retiree at American Airlines. Thank you for the privilege to have lived my dream, and to enjoy an airline career that spanned 32 years.
watch what you want. you may get it.
 
phllax
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 6:30 pm

HP would not have been that far behind US had the merger not happened. Do a search for Project Zanzibar.
 
739er
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 8:06 pm

Max Q wrote:
EA CO AS wrote:
Passedv1 wrote:

Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.


Not during the very late 90s to mid-2000s they weren't - they were at the top of their game.




We certainly were



Then UA came along...


...and brought you those pesky hubs in SFO, LAX, DEN, ORD and IAD, over 100 true widebody aircraft, and a massive international network including the largest Asian network of the US3. But hey, Maybe Jeffy could have capitalized on CALs growth potential in CLE
Last edited by 739er on Fri Aug 24, 2018 8:15 pm, edited 1 time in total.
 
Flighty
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 8:14 pm

PI4EVER wrote:
There are employees today at AA that are grateful for Douglas Parker and his team for saving this airline. The legacy of US is not that it merged/bought out/took over AA, but literally survived and subsequently became a relatively profitable and successful by " sheer grit" airline operation.
The debate on this forum is usually negative about any reference or conversation about USAirways. At the end of the day this airline did survive and thanks in large part to a large group of dedicated employees who lived and worked day-to-day with an uncertain future. There were a lot of great people at US and a fair share of not so great, but that is human nature. Not every person is a dedicated employee at their chosen field of work.
The final merger of 1989 with PI and PS ultimately fed the financial losses that occurred for decades. Competition in the 1990's with a growing and popular Southwest had a big impact, and of course we all know the effects of 9/11 that changed the landscape of airline travel and service forever.
There are many of us former US employees who went on to other careers and successful retirements who are proud of the work we performed at US and our efforts to make it a successful airline we were proud of even in the face of adversity.
And yes. I am a proud retiree at American Airlines. Thank you for the privilege to have lived my dream, and to enjoy an airline career that spanned 32 years.


That's great. US was, looking back, kind of a thrill to be involved with. Things got bad. Some of its problems were very public. It was in the national news. The operation had some good aspects, both on front lines and mgmt actually, who accurately fought thru losses to shape the go-forward business (making PHL an Atlantic hub for example, and building DCA). US then had one of the most complex networks in the world with around 3,000 daily flights, all computerized management that was quite modern for the 2000 era. By 2004, the flight crews were the most experienced, most senior flight crews in the world (due to furloughs). It was like a 747 crew manning every flight. Many airport staffers had made their careers on what was turning out to be a failing airline. But many of them still took some pride in it, and kept the operation going.

As collapse neared, people just didn't want to believe their career was going to end up for nothing. You could see it. If you see a pilot retirement party at the gate, that is a meaningful thing. It's not just a job. The years of professionalism that kept customers safe is a real thing. All the other employees, too, helped customers get where they need to go. And when we failed, it was real people in the terminal going "what now" and we felt bad. To see the brand eventually claw its way back to being legit was like a vindication that there was some value in the operation, and people could be proud of their careers. For a lot of people, that was the main job of their life, their identity. I just spent a few years in it, but I saw some of the key events. Like a sports team, we can still watch the game and gossip about the goings on. Congrats on your retirement.
 
Boof02671
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 8:28 pm

Ok don’t believe me I was only on the IAM Mechanic and Related Negotiating Committee.

Not close at all.
 
Max Q
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 10:08 pm

739er wrote:
Max Q wrote:
EA CO AS wrote:

Not during the very late 90s to mid-2000s they weren't - they were at the top of their game.




We certainly were



Then UA came along...


...and brought you those pesky hubs in SFO, LAX, DEN, ORD and IAD, over 100 true widebody aircraft, and a massive international network including the largest Asian network of the US3. But hey, Maybe Jeffy could have capitalized on CALs growth potential in CLE




Absolutely, the potential in CLE
was limitless
The best contribution to safety is a competent Pilot.


GGg
 
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EA CO AS
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Fri Aug 24, 2018 11:44 pm

Boof02671 wrote:
Ok don’t believe me I was only on the IAM Mechanic and Related Negotiating Committee.

Not close at all.


Because after all, management was always perfectly transparent with union labor negotiators when it came to possible shutdowns...
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
UA444
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 12:50 am

MIflyer12 wrote:
EA CO AS wrote:
Passedv1 wrote:

Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.


Not during the very late 90s to mid-2000s they weren't - they were at the top of their game.


CO had already been Chapter 11'd TWICE when Bethune got there, in '83 and '90.

CO was perfect and would never file BK. Those were UA’s fault.
 
UA444
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 12:55 am

tpaewr wrote:
Passedv1 wrote:
tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.



Your missing the timeline. CO troubles were in the 80s and early 90s. We are talking 2000s. CO was largely seen as the best of the US major from the Bethune era till the eve of the merger.

https://www.elliott.org/blog/is-contine ... y-carrier/

Puleeze. They were on a steady decline from 2004 up to the merger. As the other airlines exited BK and were able to get their costs closer to CO who still got to benefit from their TWO bankruptcies. The marketing and perception didn’t match the reality of an airline that was trending downward slowly but surely. Fanboys be damned.
 
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TheFlyingDisk
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 2:22 am

tpaewr wrote:
Passedv1 wrote:
tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


Am I missing the sarcasm? CO is the poster-child for extra-inning come backs of airlines. CO was on the shakiest of shaky ground for a very long time.



Your missing the timeline. CO troubles were in the 80s and early 90s. We are talking 2000s. CO was largely seen as the best of the US major from the Bethune era till the eve of the merger.

https://www.elliott.org/blog/is-contine ... y-carrier/


People got confused with your original post because of this

There was a period when ever major expect CO was on shaky ground.


I take it you mean except?
I FLY KLM+ALASKA+QATAR+MALAYSIA+AIRASIA+MALINDO
 
Runway28L
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 3:05 am

PI4EVER wrote:
Thank you Flighty for keeping the discussion on topic and not debate any other airline and their unrelated issues. This is about USAirways.

And it's funny you mentioned that because this thread has now turned into the typical UA vs CO slugfest. Maybe you jinxed things? :scratchchin: ;)

This site is so annoying to read sometimes.
 
cheapgreek
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 3:08 am

I worked for Airways during that time period. Within a few years they went through what some called it chapter 22, meaning chapter 11 twice. Many thought CEO David Seigel was going to be the airlines savior, he made a video for all employees to watch where he stated he was in it for the long haul. He bolted with millions just before the bonus period was about to end. He was a total flop and yet these types seem to latch on to another company who believes that they will turn the company around. Airways during that time US was losing its monopoly routes to new carriers in the northeast, its stronghold. They wasted valuable slots at LGA with Dash-8 flights going to small airports and then gave away the store at LGA to DL in a lopsided airport slot swap. Customer service was bad due to its take it or leave it attitude with its northeast monopoly and fares were extremely high. The introduction of JB and WN quickly cut into US profits and its northeast stronghold was no more as customers now had options. Many employees has their retirement funds in company stock and with the stroke of the bankruptcy judges pen, their funds were gone. I read about two employees, one lost 75K, the other 125K who said they were getting close to retirement age and their time remaining with the company would never allow them to regain what they lost. David Seigel, a failure, walked away with millions for doing a terrible job. Sad situation.
 
bgm
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 3:24 am

Max Q wrote:
Pretty close I think


They certainly weren’t a sustainable stand alone operation


Their reputation for customer service was awful and rightfully so



The merger with AA really saved them


They didn’t merge with AA until almost a decade later.
 
kalvado
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 3:45 am

 
southbound35
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 4:04 am

Boof02671 wrote:
Ok don’t believe me I was only on the IAM Mechanic and Related Negotiating Committee.

Not close at all.



Then I was in the room across from you at some point and completely disagree with your take. We were very, very close to shutting down. The non-merger go forward plan was not tenable.
 
jmc1975
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 4:13 am

Very close. They would have liquidated within weeks had it not been for the merger with HP.
.......
 
Boof02671
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 4:25 am

EA CO AS wrote:
Boof02671 wrote:
Ok don’t believe me I was only on the IAM Mechanic and Related Negotiating Committee.

Not close at all.


Because after all, management was always perfectly transparent with union labor negotiators when it came to possible shutdowns...

Are you just always combative know it all?

We all had to sign non-disclosures agreements and was privy to ALL the financial data.

Maybe if you were there you could actually speak about but you weren’t.

SMH.
 
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EA CO AS
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 5:50 am

Boof02671 wrote:
EA CO AS wrote:
Boof02671 wrote:
Ok don’t believe me I was only on the IAM Mechanic and Related Negotiating Committee.

Not close at all.


Because after all, management was always perfectly transparent with union labor negotiators when it came to possible shutdowns...

Are you just always combative know it all?

We all had to sign non-disclosures agreements and was privy to ALL the financial data.

Maybe if you were there you could actually speak about but you weren’t.

SMH.


southbound35 appears to have been there, and has a wildly different opinion on it.

I suppose he's a combative know it all as well?

How about all the people in this old thread, including the news site referencing an impending shutdown; all know it alls as well?

viewtopic.php?f=3&t=305513
Last edited by EA CO AS on Sat Aug 25, 2018 5:56 am, edited 1 time in total.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
LAXLHR
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 5:55 am

tpaewr wrote:
There was a period when ever major expect CO was on shaky ground. As a safe guard the online travel agencies would plate everything on CO’s 005 ticket stock. Even markets like US flying JAX-CLT or UA DEN-PDX that had nothing to do with CO. As a safety net in case some one ceases operations. It made for some complex accounting


That's very interesting! The US carriers were in shambles except for CO. Actually CO was a great airline, flew them alot.
BA IB ET JM EA GK PA VS AA SN HP CO W7 WN NW DL UA AC US LH LX OS JL QF QR WY MH CX U2 EK 9W UK TP VY VN LO OK OZ UL SQ LA

707 727 L10 732-NG 741 742 743 744 752 753 762 763 772 773 787 DC8 DC9 DC10 M80 M11 100 AB3 310 318 319 320 321 330s 340s 350 380
 
Boof02671
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 6:20 am

The 2002/2003 we were close to liquidation not the 2004/2005 as the ATSB let us use the $1 billion loan as the DIP Financing.
 
aeropix
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 6:42 am

phllax wrote:
HP would not have been that far behind US had the merger not happened. Do a search for Project Zanzibar.


I don't think Microsoft Surface tablets or mousepads would have saved the airline. The technology came out too late, and seems to be irrelevant to airliner financials.
 
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EA CO AS
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 8:11 am

Boof02671 wrote:
The 2002/2003 we were close to liquidation not the 2004/2005 as the ATSB let us use the $1 billion loan as the DIP Financing.


If you read the thread - from 2005 - you'll see that they're referencing the fact that US was in fact close to shutting down in 2005 and would have done so if not for the ATSB decision.

Just admit you're wrong already and move on.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
Boof02671
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 8:52 am

We were not.

Did you see the financial data?

We did.

We were close to chapter 7 in December of 2003.

You just want to argue.
 
Cointrin330
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Re: Just How Close Was U.S. Airways to Shutting Down in 2004-2005?

Sat Aug 25, 2018 11:51 am

enilria wrote:
TTraider95 wrote:
Hello everybody,

I was going through some random pages in the back catalog of this forum from 2004-2005 and, one consistent topic that kept coming up was U.S. Airways was on its deathbed and it was days away from shutting down. I knew they were having some serious financial problems but, I didn't know it was that bad.

So, was U.S. Airways really close to shutting down or was it the usual Civil Aviation forum where things got blown way out of proportion?

Thank you!

Not close. Large airlines don't shutdown. Even Frontier which was much more superfluous to the national airspace system found Ch11 financing. Airlines with $100s of millions of dollars in slots that have to be operated to be retained aren't going to just shut down. It was just a question of what financial rescue deal was going to win or what assets were going to be moved to who.


USAirways was very close to liquidation in the run up to the merger with America West. The airline was over-leveraged and had gone on a costly aircraft acquisition binge in the late 1990s that combined with the aftermath of 9/11 and a weak route network, heavily concentrated on the East Coast, were at the core of the airline's problems. USAirways, and its corporate predecessor, USAir, was a truly awful airline with bad service, chronic delays, surly and unhappy staff, and a business model that was outmoded even for that era in US aviation. The company's legacy still beats in the aftermath of the AA/US merger, which has revealed many of US's legacy problems still remain largely intact. The merger with HP was a disaster in its first few weeks, particularly with the cutover to a unified IT platform. Every airline merger that followed it (DL/NW, UA/CO, AA/US) worked hard to avoid the same issues. CO and UA did not succeed well with this transition. AA's and US's was the smoothest.

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