US Airways, America West plan merger

Virginia Business
June 2005

US Airways hopes that a proposed merger will allow the Arlington-based airline to emerge from bankruptcy court protection and become a low-cost carrier.

The deal between US Airways Group Inc. and America West Holdings Corp. would create an airline that would operate under the US Airways name but be based at America West’s home in Tempe, Ariz. The merged company is expected to receive $1.5 billion in new capital, including $250 million from Airbus, the European aircraft maker.

Regulators, shareholders and the U.S. Bankruptcy Court in Alexandria must approve the proposed deal.

At the time of the announcement last month, airline officials were uncertain how many jobs might be cut in the merger. US Airways employs 30,000 people, including 600 at its Arlington headquarters. America West has about 14,000 employees.

US Airways is a major carrier for most airports in Virginia. Many airport administrators around the state have been concerned about the airline’s long-term viability after it filed its second Chapter 11 bankruptcy petition in recent years. Airport officials in Richmond expect the merger to add nonstop flights to Phoenix and Las Vegas.