Keith L. Alexander

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The Future of U.S. Airways
With Keith Alexander
Washington Post Staff Writer
Wednesday, Nov. 28, 2001; 1 p.m. EST

Even before Sept. 11, US Airways was going through difficult times. The airline’s plan to merge with United Airlines failed last summer. In August, it launched a restructuring plan to reinvent itself by trying to become both a global and low-cost carrier, with smaller jets, new work rules and more international routes. That plan, executives said at the time, was the only way for the airline to survive.

Since Sept. 11, US Airways reported its largest quarterly loss in its 61-year history. The airline has laid off 11,000, reduced its operations by 23 percent and eliminated its low-fare MetroJet service out of Baltimore-Washington and Dulles international airports. And yesterday, company president and CEO Rakesh Gangwal resigned.

Post business travel columnist Keith L. Alexander and his guest Stephen Usery of US Airways was live on Wednesday, Nov. 28 at 1 p.m. EST to discuss the airline’s future and other airline issues including security. Usery is the airline’s vice president of marketing.

Below is the transcript.

Editor's Note: Washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.

Keith L. Alexander: We're getting some great questions and comments. However, to try and get as many questions answered, I would ask if you could limit your questions brief, meaning no more than three lines. Thank you.

Keith L. Alexander: Mr. Usery, thank you for agreeing to participate in this online discussion. As I'm sure you can imagine, we have a number of questions and comments from many of your customers so let's get right to it. First, I'm sure many of our readers want to know what impact the resignation of US Airways CEO Rakesh Gangwal will have on the airline?

Stephen Usery: Thank you, Keith. It is a pleasure to join you and your readers at washingtonpost.com today.

Stephen Wolf is far and away the most experienced airline executive active in the business today. He has been in leadership positions with top airlines since 1966, so the company is in very capable hands. When he reassumed the CEO's position yesterday, he said: "The company's focus going forward, working with a superb group of employees, will be on operational excellence and creating shareholder value." US Airways has a great team of officers, managers and line employees who have been and remain focused on these goals.

Keith L. Alexander: Why do airlines rely on the Internet and emails so much in reaching out to travelers? Also, can travelers find better deals through these two channels than they would elsewhere such as through traditional media?

Stephen Usery: We know that anyone who is joining our discussion today is already aware of the popularity of shopping for and booking travel on the internet. The online community has provided a great way for airlines and other travel suppliers to quickly and inexpensively provide special deals to our customers based on their own interests, past travel patterns, etc. And yes, we are frequently able to provide special deals online that aren't available elsewhere. Of course, we continue to provide special offers through our reservations centers and travel agents as well, for those who prefer to book in that manner.

Annandale, Va.: Should I use my US Airways frequent flyer miles as soon as possible?

Keith L. Alexander: Actually, this is a very popular question among our readers. Given the financial troubles the airline has been having, should US Airways frequent fliers be concerned about their miles?

Stephen Usery: Now is a great time to use Dividend Miles for travel, with Europe and the Caribbean being excellent destinations. Dividend Miles do not expire as long as a member has some activity in their account within a three year period. We look forward to serving our Dividend Miles members with great travel opportunities for a long, long time.

Washington, D.C.: Will US Airways EVER have any intra-west coast flying? flying from San Diego to Fresno or even Santa Barbara used to be a snap - now impossible

Stephen Usery: To steal a line from James Bond, "Never say never". We have an ongoing process for reviewing our route structure and the west coast is definitely on our radar screen.

Montreal Quebec Canada: If I have reservations to fly to Florida from Montreal during the month of January, how do I know US will still be flying and what happens to my money if you go bankrupt.
My ticket had been charged to Visa.
Can I cancel if you can't guarantee me safety as well as the fact that you may not be flying in January?

Stephen Usery: US Airways has publicly stated that we anticipate a cash balance on hand at the end of the year of at least $1 billion. I hope that answers the first part of your question. I also hope that you used the US Airways Bank of America Dividend Miles Visa card to purchase your ticket. If not, you lost out on the opportunity to earn extra Dividend Miles!

US Airways safely and securely carries as many as 150,000 passengers per day. I know you will be among them.

Arlington, Va.: U.S. Airways served a number of smaller East Coast airports from National before September 11th. As air travel resumes, have you discussed reopening serve to some of these smaller routes from National?

Stephen Usery: We are eager to resume our full service from Ronald Reagan Washington National Airport. The DOT has implemented a phased approach to resuming service at National and we are pleased with the progress to date and fully supportive of their ongoing efforts. As DC Mayor Anthony Williams has said, National Airport is the gateway to the nation's capital. We believe that this gateway should be open to communities both large and small, as soon as possible.

Washington, D.C.: Is USAirways looking into any other partners to use frequent flyer miles with? I have just switched to another airline's credit card because there are so few partners left worth anything. Anything in the future?

Stephen Usery: Yes. Stay tuned . . .

Fort Lauderdale, Fla.: As a chairman's preferred with US Airways I would like to know about international service in charlotte. I am employed with Bank of America and I usually travel once a month to Paris. This has caused a great inconvenience to me and all the others I work with we depend on these flights and having to go now through Philadelphia has just made us want to change carriers. When will service be reinstated.

Stephen Usery: It is our goal to resume both Charlotte-Frankfurt and Charlotte-Paris nonstop service beginning next Spring. We will be evaluating passenger demand constantly. In the meantime, we have ensured that our connections via our Philadelphia gateway are as fast and convenient as possible.

Washington, D.C.: What is your favorite USAirways destination?

Stephen Usery: Rome. My wife and I love Italy. The food, the history, the people, the food. Did I mention the food?

Washington, D.C.: How long do you think it will take for your company, and the whole airline industry, to get back on its feet?

Stephen Usery: None of us has a crystal ball. We at US Airways are diligently working to ensure that our company not only survives this crisis, but thrives in the future. Our success is driven by many factors - our own restructuring efforts, the global economy, consumer confidence, etc. The number of Americans travelling by air over the Thanksgiving holiday was very encouraging. In our own restructuring, we are focused on maintaining our platform for future growth by continuing to serve virtually all communities that we served prior to September 11.

Washington, D.C.: I was hoping to use USAir frequent flyer miles for a trip to Rome in Feb. or March, but don't find Rome on the schedule for those months. How many European destinations have they abandoned?

Stephen Usery: In the Feb-March time frame you ask about, US Airways will serve Amsterdam, Paris, Frankfurt, Rome, London, Manchester, Munich and Madrid. Rome will be served from Philadelphia 5 times a week in February and early March, with a return to daily service on March 17.

Washingon, D.C.: What was the rationale behind the new Caribbean service? US Airways is expanding like mad down there. Future routes planned or a hub?

Stephen Usery: The Caribbean is a very popular destination for US Airways customers and our additional service is in direct response to this demand. We have the most comprehensive network of service in the Eastern US, which is also the top source of tourist travel to the Caribbean and related tropical destinations. Our newest destinations include Antigua, Barbados, Cozumel, Grand Bahama Island/Freeport and St. Lucia. In total, by early 2002 we will serve 20 tropical destinations. These destinations compliment our extensive service to Florida and provide an excellent portfolio of destinations for our Dividend Miles members.

Herndon, Va.: Recently I booked a non-stop trip to New Orleans from Reagan National via usairways.com. I later received notification that the flight was changed to BWI. Should customers expect continuing schedule changes like this?

Stephen Usery: As I noted in an earlier response, we are eager to resume our full service from National airport. Until we are able to do so, we will continue to serve Washington area residents from Dulles and BWI airports as well as into National via our hubs. Since the final timeline for resumption of service from National is not yet known, we will re-route passengers who already hold reservations out of National to ensure they reach their final destination in a timely manner.

Takoma Park, Md.: Mr. Usery, how is USAirways feeling about its Airbuses in light of the disaster at Far Rockaway?

Stephen Usery: The cause of the recent incident is still under investigation, so it would be inappropriate for me to comment. What I can say is that safety has been, is and will remain our top priority. The performance of our newer generation A319, A320, A321 and A330 aircraft has been flawless.

Chantilly, Va.: As a DM member at the US1 tier, I use the Clubs frequently. When are the closed facilities in Pittsburgh and Charlotte going to reopen?

Stephen Usery: We are constantly monitoring traffic in our Clubs and are planning to reopen Pittsburgh and Charlotte facilities at some point in the future.

Keith L. Alexander: Mr. Usery, several readers want to know with the continued reduction in amenities on US Airways' flights such as meals, movies, china in first class, etc, why should they continue to pay "high" fares on US Airways when they can get the same type of service for cheaper fares on carriers such as Southwest?

Stephen Usery: In the wake of September 11, all airlines took swift and dramatic actions to reduce costs in the face of a precipitous decline in demand. We continue to review all of these decisions as demand returns.

We are proud of the fact that we continue to offer a very high quality product, especially when compared to our no frills competitors such as Southwest. What such competitors don't provide customers, but which US Airways does, includes advance seat assignments, a frequent flier program offering multiple options to earn and redeem miles around the world, an international route network, a full intrastructure for the business traveler (including Clubs) and much more.

Keith L. Alexander: Mr. Usery, thank you for participating in this discussion. We had more than 200 questions and we obviously could not get to them all. Do you have any final words or comments?

Stephen Usery: Keith, I really appreciate the opportunity to talk to you and your readers about US Airways. Thanks to washingtonpost.com!

Keith L. Alexander: Again, allow me to thank our guest today, Mr. Stephen Usery, vice president of marketing for US Airways. We also want to thank the hundreds of you who submitted questions. Unfortunately due to time constraints we could not get to all of your questions. However, Mr. Usery has agreed to do this again sometime soon. So stay tuned to Business Class every Wednesday for the next scheduled online discussion with US Airways.