US Airways restructuring will mean job sacrifices
By Tim Whitmire
Associated Press
CHARLOTTE, N.C. With the future of US Airways uncertain, CEO David Siegel visited the carrier's biggest hub yesterday, hoping to persuade workers to agree to a massive restructuring that includes wage cuts and likely job losses.
Associated Press
"We're not making promises that there won't be any layoffs," he said during a news conference at Charlotte-Douglas International Airport. "We can't. ... The objective is to save the maximum number of jobs, pay our employees as much as we can and still have a viable business plan."
To qualify for loan guarantees, US Airways CEO Dave Siegel says, the carrier must cut $1.3 billion in annual costs with $950 million in labor expenses targeted.
Siegel said US Airways, the nation's seventh-largest air carrier, needs to cut $1.3 billion in annual costs to qualify for federal loan guarantees offered as assistance since the sharp downturn in air travel after Sept. 11. He said $950 million of the cost reductions must come from labor expenses.
Siegel declined to be more specific about where the cuts would come, saying airline management is committed to collaborating with the unions that represent its workers.
The government has set a June 28 deadline for airlines to apply for the loan guarantees. US Airways says it needs $1 billion in guarantees to raise capital.
On top of reduced labor costs, Siegel said, the airline hopes to save $350 million annually by cutting management costs and seeking concessions from suppliers and others.
As head of the airline, he promised to take the greatest proportional pay cut, though he declined to specify what that might equal. Siegel's annual salary has been reported to be a minimum of $750,000.