US Airways 2007 Annual Report Download - page 7

Table of Contents
PART I
Item 1. Business
Overview
US Airways Group, a Delaware corporation, is a holding company formed in 1982 and whose origins trace back to the formation of
All American Aviation in 1939. US Airways Group's principal executive offices are located at 111 West Rio Salado Parkway, Tempe,
Arizona 85281. US Airways Group's telephone number is [phone], and its internet address is www.usairways.com. US Airways
Group is a holding company whose primary business activity is the operation of a major network air carrier through its wholly owned
subsidiaries US Airways, Piedmont Airlines, Inc. ("Piedmont"), PSA Airlines, Inc. ("PSA"), Material Services Company, Inc. ("MSC"),
and Airways Assurance Limited. On September 12, 2004, US Airways Group and its domestic subsidiaries, US Airways, Piedmont, PSA
and MSC (collectively, the "Debtors"), which at the time accounted for substantially all of the operations of US Airways Group, filed
voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (the "Bankruptcy Code") in the United States Bankruptcy
Court for the Eastern District of Virginia, Alexandria Division (the "Bankruptcy Court"). On May 19, 2005, US Airways Group signed a
merger agreement with America West Holdings Corporation ("America West Holdings") pursuant to which America West Holdings
merged with a wholly owned subsidiary of US Airways Group. The merger agreement was amended by a letter of agreement on July 7,
2005. The merger became effective upon US Airways Group's emergence from bankruptcy on September 27, 2005.
As a result of the merger, we operate the fifth largest airline in the United States as measured by domestic revenue passenger miles
("RPMs") and available seat miles ("ASMs"). For the years ended December 31, 2007, 2006 and 2005, passenger revenues accounted for
approximately 93%, 93% and 92%, respectively, of our operating revenues. Cargo revenues and other sources accounted for 7%, 7% and
8% of our operating revenues in 2007, 2006 and 2005, respectively. We have primary hubs in Charlotte, Philadelphia and Phoenix and
secondary hubs/focus cities in Las Vegas, New York, Washington, D.C. and Boston. We are a low-cost carrier offering scheduled
passenger service on approximately 3,800 flights daily to 230 communities in the continental United States, Hawaii, Alaska, Canada, the
Caribbean, Latin America and Europe, making us the only U.S. based low-cost carrier with a significant international route presence. We
are also the only low-cost carrier with an established East Coast route network, including the US Airways Shuttle service, with
substantial presence at capacity constrained airports including New York's LaGuardia Airport and the Washington, D.C. area's Ronald
Reagan Washington National Airport. We had approximately 58 million passengers boarding our mainline flights in 2007. During 2007,
we provided regularly scheduled service or seasonal service at 137 airports. During 2007, the US Airways Express network served 201
airports in the United States, Canada, the Caribbean and Latin America, including approximately 82 airports also served by our mainline
operation. During 2007, US Airways Express air carriers had approximately 27 million passengers boarding their planes. As of
December 31, 2007, we operated 356 mainline jets and are supported by our regional airline subsidiaries and affiliates operating as US
Airways Express, which operate approximately 232 regional jets and 104 turboprops.
On September 26, 2007, as part of the integration efforts following the merger of US Airways Group and America West Holdings,
America West Airlines, Inc. ("AWA") surrendered its Federal Aviation Administration ("FAA") operating certificate. As a result, all
mainline airline operations are now being conducted under US Airways' FAA operating certificate. In connection with the combination of
all mainline airline operations under one FAA operating certificate, US Airways Group contributed 100% of its equity interest in America
West Holdings, the parent company of AWA, to US Airways. As a result, America West Holdings and AWA are now wholly owned
subsidiaries of US Airways. In addition, AWA transferred substantially all of its assets and liabilities to US Airways. All off-balance
sheet commitments of AWA were also transferred to US Airways. Pilots, flight attendants, and ground and maintenance employees
continue to work under the terms of their respective collective bargaining agreements, including, in some cases, transition agreements
reached in connection with the merger.
Our results are seasonal. Operating results are typically highest in the second and third quarters due to greater demand for air and
leisure travel during the summer months and US Airways' combination of business traffic and North-South leisure traffic in the eastern
and western United States during those periods. For information regarding
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