Braniff International Corp. and PSA Inc. yesterday proposed a joint airline venture that could put to work as many as 1,500 idled Braniff workers and 25 to 30 of the grounded airline's planes.
At a news conference in Dallas, Braniff Chairman Howard D. Putnam and PSA Chairman William R. Shimp said the proposed joint venture would operate under PSA's name and utilize PSA's marketing programs, but would remain a separate venture.
The new venture will serve cities east of Texas, Shrimp said, feeding passengers primarily through Braniff's major hub at Dallas to the West Coast area served by PSA.
Until airline deregulation began in 1978, San Diego-based PSA -- Pacific Southwest Airlines -- operated only in California, where it pioneered low-fare, high-frequency air service. Now, it serves 16 cities in California, Arizona, Nevada and Washington with a fleet of 32 planes.
The venture requires the approval of Braniff's creditors, its unions and the federal bankruptcy court in Fort Worth where the debt-ridden carrier sought protection after it suspended services in May. Braniff's chief financial officer, M. Philip Guthrie, said he was optimistic yesterday that creditors would view the venture favorably, noting that it had the potential to give them more money than they would get if Braniff were liquidated.
No routes to be served by the new line were identified yesterday and many details of the operating agreement remain to be worked out. A letter of intent signed by the two companies over the weekend calls for an eight-year operating agreement, with an option for an eight-year extension. The joint venture could start operating as soon as 60 days from now or as late as next spring, the officials said. Only domestic routes will be flown.
Braniff's Putnam said the joint venture hinges upon securing "highly productive labor contracts" covering the former Braniff employes to be hired. The contracts would have to include work rule changes that would allow increased flying time for pilots and flight attendants and permit employes to perform more than one duty. Putnam also said salaries of the employes would have to be "considerably lower" than Braniff paid its employes before.
Putnam said that up to 1,500 former workers would be rehired on the basis of seniority, including about 300 pilots and 300 flight attendants. The new contracts to be negotiated would have to be acceptable to PSA, he said.
Besides its aircraft and employes, Braniff also would contribute airport landing rights and gate facilities to the joint venture, the officials said.
More than 9,000 Braniff employes lost their jobs in May when the airline ran out of cash and closed down, parking its planes at two Dallas airports. Braniff said yesterday it has 62 planes now, including 52 Boeing 727s. PSA operates 21 McDonnell Douglas DC9 Super 80s and 11 Boeing 727s.
According to papers filed with the bankruptcy court, the airline owes almost $1 billion to its creditors.
Last week, Federal Bankruptcy Judge John Flowers extended for 30 days the deadline for Braniff to submit a reorganization plan after Braniff officials said the prospects for putting together a joint operating agreement were better than they had been a month earlier, when the judge granted a 35-day extension.