US Airways 2006 Annual Report Download - page 17

Table of Contents
FAA, as have most other U.S. airlines. The Emergency Wartime Supplemental Appropriations Act extended this insurance protection
until August 2005. The program was subsequently extended, with the same conditions and premiums, until August 31, 2007. Under the
Vision 100 — Century of Aviation Reauthorization Act, the President may continue the insurance program until March 30, 2008. If the
federal insurance program terminates, we would likely face a material increase in the cost of war risk coverage, and because of
competitive pressures in the industry, our ability to pass this additional cost to passengers may be limited.
Customer Service
We are committed to building a successful combined airline by taking care of our customers. We believe that our focus on excellent
customer service in every aspect of our operations, including personnel, flight equipment, inflight and ancillary amenities, on-time
performance, flight completion ratios and baggage handling, will strengthen customer loyalty and attract new customers. Combined DOT
measures as reported by AWA and US Airways for the years ended December 31, 2006, 2005 and 2004 were as follows:
Full Year
2006 2005 2004
On-time performance(a) 76.9 77.8 78.1
Completion factor(b) 98.9 98.2 98.4
Mishandled baggage(c) 7.82 7.68 4.85
Customer complaints(d) 1.35 1.55 1.14
(a) Percentage of reported flight operations arriving on time as defined by the DOT.
(b) Percentage of scheduled flight operations completed.
(c) Rate of mishandled baggage reports per 1,000 passengers.
(d) Rate of customer complaints filed with the DOT per 100,000 passengers.
Our on-time performance for 2006 ranked second among the ten largest U.S. carriers as measured by the DOT. During 2006, we
achieved significant operational improvements at our Philadelphia hub. Specifically, customer complaints are down over 30 percent from
2005 levels. In addition, mishandled baggage per 1,000 enplanements is down nearly 15 percent year-over-year, with over 95 percent of
all local in-bound baggage now delivered to the baggage carousel in 19.1 minutes on average.
Frequent Traveler Program
All major United States airlines offer frequent flyer programs to encourage travel on their respective airlines and customer loyalty.
Prior to the merger, AWA and US Airways operated separate frequent flyer programs, known as "FlightFund" and "Dividend Miles,"
respectively. Following the merger, the two frequent flyer programs were modified to allow customers of each airline to earn and use
miles on the other airline, and in May 2006, the two programs were merged into the new Dividend Miles program, which is substantially
the same as the former US Airways program. As part of the merger of the plans, the accounts of members participating in both programs
were merged into single accounts of the new program.
The new Dividend Miles frequent flyer program allows participants to earn mileage credits for each paid flight segment on AWA,
America West Express, US Airways, US Airways Shuttle, US Airways Express, Star Alliance carriers, and certain other airlines that
participate in the program. Participants flying on first class or Envoy class tickets receive additional mileage credits. Participants can also
receive mileage credits through special promotions that we periodically offer and may also earn mileage credits by utilizing certain credit
cards and purchasing services from non-airline partners such as hotels and rental car agencies. We sell mileage credits to credit card
companies, telephone companies, hotels, car rental agencies and others that participate in the Dividend Miles program. Mileage credits
can be redeemed for free, discounted or upgraded travel awards on AWA, US Airways, Star Alliance carriers or other participating
airlines.
AWA, US Airways and the other participating airline partners limit the number of seats allocated per flight for award recipients by
using various inventory management techniques. Award travel for all but the highest-level
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