US Airways 2005 Annual Report Download - page 58

Table of Contents
In the area of finance, we have:
• repurchased warrants associated with AWA's ATSB loan for $116 million; and
• combined all of our insurance programs, which will save $41 million annually.
In the marketing area, we have:
• established Dividend Miles as our frequent flyer program, and created mechanisms for reciprocal benefits, accrual and redemption between Dividend
Miles and AWA's FlightFund program;
• completed all Star Alliance joining requirements;
• introduced a new affinity credit card with Barclays PLC through our agreement with Juniper;
• announced three new European destinations, Lisbon, Milan and Stockholm, which will begin service this summer; and
• reduced numerous fares in several East Coast markets, including Philadelphia, Charlotte, Pittsburgh and New York/ LaGuardia.
US Airways Group's labor integration team has achieved the following since the merger closed:
• recalled 55 furloughed US Airways pilots and announced several new hire flight attendant classes, which will include recalling furloughed US Airways
flight attendants;
• began the process to bring some of the currently outsourced reservations work back in house by increasing hiring in Winston-Salem, North Carolina
and Reno, Nevada;
• reached transition agreements with US Airways' and AWA's pilots and flight attendants;
• reached a transition agreement with a new labor alliance between CWA and IBT, which represents US Airways' and AWA's customer service
employees; and
• received single carrier certification by the National Mediation Board, which will further the process of getting to single representation for US Airways'
and AWA's mechanics and fleet service workers.
In the area of cultural integration, we continue to make progress and have achieved the following milestones:
• we paid out three consecutive monthly bonuses, totaling $5 million, to employees for achieving on-time performance goals in October, November and
December;
• we implemented new internal communication programs designed to ensure senior management visibility among all areas of the Company's operation;
• we unveiled one of four heritage planes that will feature throwback liveries of the four major airlines that comprise the new US Airways (Allegheny,
AWA, Piedmont and PSA); and
• we began an aggressive leadership development training program that will ultimately touch all leaders at US Airways Group.
Cost Control
We remain committed to maintaining a low cost structure, which we believe is necessary to compete effectively in the airline industry. Low cost carriers,
some of which have cost structures lower than ours, continue to enter and grow in the markets in which we operate. In addition, the traditional legacy carriers,
which have competitive advantages including vast route networks, alliances and generous frequent flyer programs, remain focused on lowering their
respective costs. This includes using the bankruptcy process to restructure with lower cost structures. In light of this environment, we continue to focus on
minimizing unnecessary capital expenditures and prudent spending for discretionary expenses.
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