US Airways SJ talks break down

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By Keith L. Alexander
Washington Post Staff Writer
Sunday, March 10, 2002; Page A07


An attempt by US Airways Group Inc. to replace much of its fleet with
small regional jets, a key to its strategy for long-term survival,
abruptly stalled yesterday after a clash with its pilots' union, both
sides said.

The Arlington airline has been negotiating with the pilots since
January, hoping to add at least 400 of the regional jets to its fleet
in place of many larger jets and turboprops to reduce costs and
become more competitive with East Coast rivals. Doing so would result
in lower pay for many pilots, who are generally paid according to the
size of the planes they fly.

US Airways Chairman Stephen M. Wolf said last month that the two
sides were near agreement, and the union told members Friday that
there was agreement or progress on many issues. But talks broke down
yesterday over job-protection issues.

Roy Freundlich, spokesman for the Air Line Pilots Association, said
the union ended discussions because "we were not making progress on
any of our issues, only on the company's issues." Freundlich said the
union has no plan to resume talks.

The pilots have insisted that laid-off pilots be rehired to fly the
regional jets. According to Freundlich, Wolf refused to make that
offer and did not empower airline representatives to do so. "This is
another failure of Stephen Wolf," he said.

An airline spokesman said: "US Airways' need for more regional jets
is well-known. We are disappointed in the results."

The breakdown in talks came three days after US Airways named former
Avis Rent A Car and Continental Airlines executive David Siegel as
president and chief executive. Siegel is to start work tomorrow and
is scheduled to meet with union leaders to talk about his plans for
the airline. Freundlich said he was not optimistic about resuming
talks under Siegel.

Last summer, after US Airways' attempt to be acquired by United
Airlines failed over antitrust concerns, Rakesh Gangwal -- who then
was chief executive -- outlined a plan to downsize the airline by
replacing larger planes with regional jets, which typically have 50
to 70 seats.

The airline, which lost $1.9 billion last year, said it needed about
420 regional jets in its system. Union officials agreed to 315, up
from as few as 50 more than a month ago. But the union wanted
guarantees that furloughed pilots would be hired to fly those jets
and that the airline would not shrink its mainline operation any
further.
 
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