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USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 10:14 am
by dcbat2072
If USAirways does liquidate, what will be the immediate effect on flights in and out of DCA? What about their USAirways Express services, such as Chitaqua, Colgan, etc??? Say they liquidate next Monday...what will the schedules look like out of DCA say on Tueday? Will other airlines immediately step in and fill all the USAirways flights? Will their be a drastic reducation of airline service to DCA?

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 10:57 am
by gigneil
I've been very curious about this myself.

DCA is a prime piece of real estate. During the UA/US merger, CO was desperate to get the US assets that were going to be sold to DC Air.

I would imagine some airline would rush in, but I couldn't begin to tell you which.

N

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 11:03 am
by cha747
To answer your question, liquidation means liquidation. My guess is that, unless a buyer or investor comes along, a date will be set and then things will stop flying. This would mean temporary devastation for DCA and PIT, PHL, CLT, BOS, and LGA to name a few. If it happens it will be quickly from the time it is announced.

I'm still hoping for the best. Worst case scenario, other airlines come in and offer the service. The bad news is that there will be a lot of senior pilots, flight attendants, ground crew, mechanics, and other staff that will be jobless for an indefinite period of time.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 11:04 am
by graham697
Normally it would probably take a bit longer to gain entry to DCA, as you would have to go through the bureaucratic process for slots (I don't believe you can sell DCA slots). Now if US Airways did liquidate I am sure that congress would enact some special legislation temporarily lifting the slot process so they can get a flight home at the end of the week.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 1:04 pm
by dcbat2072
I don't think it would be devastating at all at DCA...I mean, besides NYC, everyone wants to fly to DC...businessmen, congressman, senators, government officials, locals, and tourists all year long...and considering it's right next to the city itself, it's a highly competitive market to get into, not to mention a $ maker...some airlines would kill to get a shot at the highly coveted slots at DCA...it's a small but very busy airport, 3 miles from downtown Washington, Metro access right by the terminal, clean, efficient, and uncongested. DC is a whole different kind of city very much unlike PIT, PHL, BOS, or CHT....I don't see any comparison.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 1:23 pm
by jfklganyc
I see LGA slots being sold off very soon if they move toward liquidation. I'd imagine it would be a lot like the DL/PA takeover. Next day they were flying--under a new name.
I don't anticipate many problems at LGA or DCA.

PJ

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Mon Sep 13, 2004 1:31 pm
by burnsie28
My guess is that NW would get more slots and re-start their DCA hub.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 1:28 am
by gigneil
Actually, I've been thinking about this more over the last few days.

I think Delta would be in a good position to move more assets in at DCA, despite their financial woes.

1) DL has a huge setup at DCA already, and could accomodate further flights no problem.
2) DL stands to benefit most from the collapse of US. CLT drains passengers from ATL, and they overlap on routes in much of the Southeast especially FL.
3) US is the largest East Coast carrier, and DL is the second. This would make DL the largest by a long, long shot.
4) DCA would give DL a high percentage of business travelers... not much VFR traffic at DCA, and, although there are tourists, only wealthier tourists choose DCA - the rest fly to BWI or IAD.


N

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 1:45 am
by 7e72004
I think i could see the watering mouth of Southwest in PHL!! *lol*

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 3:36 am
by N1120A
I think B6 might take an interest in the BOS slots. They seem to be doing well there, so well that they moved all ATL flights (that got lost in the FL-DL war) to BOS. What I think would be interesting is, even though they have the massive BWI operation, WN moving into DCA. They could operate it like they do DAL, and DCA has even fewer restrictions. If they could get a good number of the US slots there, they could open up a tidy little home there. Just a rambling. I do think, however, that if US disolved, WN and B6 would be chomping at the bit to grab CLT

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 4:58 am
by gigneil
BOS is not a slot controlled airport.

N

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 5:09 am
by Clipper002
Hold on for a minute here. Having been through a Chapter 7 at Pan Am, I can lend a little bit of first hand information on what happens. Once you declare c
Chapter 7, you must ground all flying at once. You may be allowed to have crews ferry a/c back to maintenance bases but no revenue flying is permitted.

Once all of that takes place, you then must inventory every one of your assets, ranging from airframes and powereplants down to pillows and blankets. Everything. At Pan Am that took a group of us just in excess of 6 months. Only after the inventory is complete and a dollar value assigned can anything be auctioned off or sold. All of these events must be court approved. It's a long and laborious event.

Now the real question on this thread would be how a US shutdown would be at DCA. Let me tell you, there is not one airline that either the equipment or the personnel to try and go into someplace and start up a "turnkey " operation. They just don't exist. As for an impact on the cities listed in previous posts, I'd like to point out too that there is a huge impact whenever you suddenly remove the list of available seats in any market on a given day. Another airline may fly a few extra sections or even upgrade equipment to help stranded passengers, but that is more out of a sense of humanity than it is to make a quick buck.

Finally, someone was comparing this to the DL/PA deal in 1991. That was entirely different than this situation. Delta was already to take over Pan Am months before they actually did. Pan Am was to have been left with Pan Am II based in MIA and flying 727's and A-300's throughout the Caribbean. Suddenly Delta execs realized that Pan Am was bleeding them dry with cash infusions into an already dead animal and decided not to back the birth of Pan Am II. That's when we shut down the airline and filed for Chapter 7 liquidation.

It'll all work out in the end though, just as it has with other grand airlines like EA and BN just to name 2.

The employees left behind are the ones hurt the most. Airlines are not like the general workplace out there. People tend to stay with airlines for longer durations than other's in the workplace. The end result is that you have some quite senior people who have given most of their adult life working for one company and suddenly one day there's nothing left. I was one of the lucky ones, but I know literally hundreds who were not as fortunate as myself. Take that and multiply it by all of the airlines that have faded in the past 15 years and you'll find a significant number of affected people. For the employees of US, I hope somehow they can weather this storm, although I don't see how. My thoughts and prayers go out to all of you.

Ed

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 5:28 am
by moose1226
Only wealthier tourists choose DCA - the rest fly to BWI or IAD

To my knowledge, that is not true. The fare on a Legacy carrier to a given city out of DCA in not necesarily higher than that of a legacy carrier out of IAD or BWI. When you figure in the presence of WN at BWI and Indy at IAD, things look different, although there is one LCC at DCA.

....FL

It will certainly be interesting to see what happens at DCA in the next year or so. I'm sure that it is a very lucrative market, and that many airlines woule be happy to get more involved there.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 5:30 am
by TomFoolery
DL Already has hourly flights to LGA, and then a half dozen or so to JFK, I don't think there would be a great increase to that schedule. I definitely don't see WN touching DCA, especially with their large presence at BWI. UA has the same hourly service to LGA, as with ORD, I could see TED taking over the point-to-point service, like to MCO, or MIA, etc., but most of UA's flights are to ORD, BOS, and LGA. I don't see US liquidating any time in the immediate future. They will have a lot of financial protection under the bankruptcy. When US filed, they had to submit a business plan, which gives benchmarks that need to be met by a certain time. If they miss these benchmarks, they go into default. If that happens, the protections can be taken away from the courts, and the airline (or company) starts to liquidate.
Executives can use bankruptcy to the company's benefit (HP, CO) or to simply prolong fleecing the company (Eastern) and run it into the ground.

Keep in mind, that I am an Engineer, NOT a financial analyst, and the information is, to my best knowledge, correct, but if I'm off somewhere, don't get upset, but DO correct me...This is my disclaimer!


TF

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 5:38 am
by mariner
Moose1226:

"...although there is one LCC at DCA - FL."

Um - more than one. I think Frontier is regarded as a LCC>

cheers

mariner

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 5:44 am
by tcttx
If US were to liquidate, would CO be in a position now to acquire some DCA assets when CO can't even afford to make its scheduled pension contribution?

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 5:54 am
by gigneil
DCA in not necesarily higher than that of a legacy carrier out of IAD or BWI.

That's just not true. The average fare from DCA is many times that of one from IAD or BWI, especially on short notice.

N

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 6:06 am
by ScottB
One complication regarding the disposition of the DCA and LGA slots in the event of a US Airways, Inc. liquidation would be the use-it-or-lose-it provisions attached to those slots. If the slots aren't used for a certain time period (90 days, if memory serves), they revert to DOT to be reallocated. Thus, any sort of auction of US's slot holdings would likely need to occur relatively quickly, and any acquirer(s) of said slots would have to be in a position to begin operations without significant delay. It may be possible for the bankruptcy judge to suspend DOT's slot utilization requirements temporarily, however, in order to assure the maximum possible return in a hypothetical slot aution process.

Few airlines have the ability to build up a presence at DCA rapidly (on the order of 100+ daily departures within a few months), so I'd imagine that the slots would be divided among multiple airlines. Count me as one who thinks that DCA would indeed work very well for WN, given that they have the capital to acquire slots and the aircraft coming to add flights. They also have name recognition and market presence in the region. DCA's slot restrictions help to reduce congestion at the airport, and it's a convenient downtown facility like DAL and HOU. Folks will still be willing to travel to BWI for cheaper fares if WN sets prices somewhat higher at DCA. That would be very bad news for Independence, though -- as would the expansion of any LCC at DCA.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 6:15 am
by moose1226
Mariner:

Excuse me, I forgot about F9 at DCA. Please pardon my error.

Thanks.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 6:29 am
by mariner
Moose1226:

It's okay - I was just having a bit of fun.  Smile/happy/getting dizzy

cheers

mariner

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 10:17 am
by IAHtown
I doubt CO is interested at this point. They're suffering, even if they're doing better than other legacies. And they have no interest in US's new Airbus fleet. NW is a definite maybe. DL isn't looking to complicate their grave situation by undergoing a major expansion. What about AWA? I haven't heard much about their financial situation lately, but I bet they'd love an east coast hub at DCA. I also think a certain British billionaire might have his eye on this prize. Whatever happens if US liquidates, I hope someone fills the void ASAP and hires as many former US employees as possible.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 10:40 am
by AA777
The problem is that no airline has the money to open up alot more capacity at DCA. UA = Bankrupt. AA, doing decent, but by no means ready to buy out slots at DCA. I would hope AA would use DC as a hub, then we would have United and American as main carriers (those are my two favorites).... DL could definitley use it, and DCA is a wonderful airport to take advantage of. People love flying there b/c it is so convenient. All bets are off on this one, anything could happen. Jetblue, if they had teh capacity would be very smart to take advantage of this-- they could even take some of US's A320s & A319s.

Who knows? I just hope that USAirways will stay with us! I have a friend whose Father is a Pilot (A330, 767) for US, and whose mother is a Flight Attendant for US also... I really worry for them now.

-AA777

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 10:09 pm
by RayChuang
How about this possibility: US Airways sells off everything except for the BOS-LGA-DCA route? Given that the Northeast Shuttle route is probably US' only profitable operation, they could keep that route using exclusively A319/A320 planes.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Tue Sep 14, 2004 10:35 pm
by petazulu
Fares to DCA are NOT "many times" those at BWI or IAD. I think that is a product of you imagination. Perhaps last minute fares are slightly more (less than 20%). Millions of people fly into DCA who are not "wealthier tourists and business travelers". You make it sound like DCA is a haven for the rich and powerful only.

As for US Air- maybe "DC Air" will finally start up. You know the senators, congressmen won't let those unique routes dissappear for very long! They want to get home to their families on weekends.

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Wed Sep 15, 2004 12:38 am
by gigneil
Fares to DCA are NOT "many times" those at BWI or IAD. I think that is a product of you imagination

It is not a figment of my imagination. As a regular business traveler in the DC area, fares for the trips I want to take are often well in excess of 20% more at DCA. Frequently on shorter notice, fares from DCA can be 2 to 3 times as expensive.

Routes with competition from F9, Spirit, or FL do feature more competitive fares.

DCA is a business oriented airport, with the attendant fare hikes.

N

RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Wed Sep 15, 2004 4:27 am
by TomFoolery
I fly through DCA quite often, and in recient years, the fares have really come down in price. There are always routes that for whatever reason cost alot and some that dont, but for the convienience, DCA is a VERY adventageous location for an airline. It is up to the airline to come up with a lucrative route.


RE: USAirways Possible Ch 7 Implications At DCA?

Posted: Wed Sep 15, 2004 4:45 am
by gigneil
I agree with that assessment, which is why I think people will be rushing in to fill the void.

N