Includes Domestic, International Routes From DCA, LGA
US Airways and Delta Air Lines announced a transaction
Tuesday that expands US Airways service at Ronald Reagan Washington
National Airport (DCA), and gives the airline access to key
business centers in Brazil and Japan. US Airways will obtain 42
pairs of Delta’s slots at DCA and acquire the rights to
expand to Tokyo, Japan and Sao Paulo, Brazil. Simultaneously, US
Airways will transfer 125 pairs of its slots to Delta at New York's
LaGuardia Airport (LGA). One slot equals one takeoff or landing; so
one pair of slots equals one roundtrip flight.
US Airways will retain a significant presence at LGA. The
reduction in flying necessitated by the transfer of LGA slots will
be accomplished through reductions in US Airways Express flying.
The airline does not plan to make any changes to mainline flight
levels, including its popular US Airways Shuttle service with
hourly flights from New York to Boston and Washington.
“We are very excited about today's announcement which
presents an excellent opportunity to strengthen our network while
bringing more jet air service to smaller communities from our
nation's capital," said US Airways Chairman and CEO Doug Parker.
"This transaction will improve US Airways’ near and long-term
profitability to the benefit of our employees, our customers, the
communities we serve, and our shareholders.”
The transaction is structured as two simultaneous asset sales
and is expected to be cash neutral to US Airways. US Airways
estimates the transaction will improve profitability by more than
$75 million annually.
“This is great news for travelers to and from the
Washington, D.C. region,” said US Airways Senior Vice
President, Marketing and Planning Andrew Nocella. “After the
transaction is complete, US Airways will provide nonstop service
from DCA to 15 new daily destinations, and to further ensure
continuity for air travelers, we also plan to maintain existing
service today to all DCA destinations that Delta may discontinue as
a result of this transaction.”
Nocella continued, "We also plan to increase the number of seats
we fly at DCA by using larger dual-class jets. This will increase
capacity in a dense market, where demand continues to be brisk,
without the negative effects of additional congestion."
US Airways will operate 229 peak-day departures at DCA. However,
there will be no increase in net flight activity at DCA due to
Delta’s reduction in slots. US Airways’ expanded
presence at DCA will create approximately 100 new US Airways jobs
that will be allocated to DCA and throughout the new regions where
the airline is starting service.
US Airways will also acquire from Delta the rights to operate
daily service at two of the world’s most important business
destinations – Sao Paulo, Brazil and Tokyo, Japan. These two
cities will complement US Airways’ existing portfolio of more
than 50 international destinations in more than 30 countries and
territories across Europe, the Middle East, Latin America, North
America, and the Caribbean.
With 125 fewer slot pairs at LGA, US Airways plans to
discontinue service to 26 Express destinations served from LGA. The
reduction in Express flying at LGA will result in the need for
approximately 300 fewer employees at US Airways’ wholly owned
regional carrier, Piedmont Airlines. Piedmont CEO Steve Farrow
said, "While this is good news for our parent company, US Airways,
it is very disappointing news for the Piedmont team. Our employees
have done an excellent job of providing service to US Airways and
its customers. We understand the need to optimize assets, though,
and we will ensure that all affected Piedmont employees are treated
fairly."
For Delta's part, the company is
equally enthusiastic about the deal. Delta expects to more than
double the number of nonstop destinations it serves from LaGuardia
by adding or preserving service to more than 30 small- and
medium-sized communities. New markets and larger aircraft would
allow more than two million additional passengers to transit
LaGuardia each year without increasing the total number of takeoffs
and landings.
"Delta's investment at LaGuardia is good for customers because
it provides new convenient service options and ensures continued
access to many small communities that our competitors have not
historically served," said Gail Grimmett, Delta's senior vice
president - New York. "During the last 30 years, successful slot
trades have helped foster a competitive environment for the airline
industry. With this agreement, Delta will inject additional
competition in the New York market. Many small- and medium-sized
communities throughout upstate New York and New England will
benefit from service upgrades where Delta will operate larger
regional and mainline jets."
Once the transaction is approved, Delta plans to begin a nearly
$40 million construction project at LaGuardia, which should
be completed in 2010.