US Airways Group Inc. on Monday will announce the establishment of a new mini-hub in Fort Lauderdale, Fla., in a major strategic move to build on what is increasingly its biggest strength, its Caribbean route system.
The ailing Arlington-based airline, which is trying to get another round of concessions from its employees to avoid a second Chapter 11 bankruptcy filing, plans to serve about 15 cities from Fort Lauderdale-Hollywood International Airport beginning in February -- including destinations in Mexico, South America and Caribbean islands. It also will add domestic flights from some key Northeast cities to Fort Lauderdale that would connect passengers to the international flights.
US Airways' move to build up its Caribbean system -- reported earlier by the Miami Herald -- comes as it eliminates about one-third of the flights at what once was its primary domestic hub, in Pittsburgh. The airline will shift jets being pulled out of Pittsburgh to Fort Lauderdale.
"This is a very bold move for an airline in their financial position to make," said Darryl Jenkins, an aviation consultant and professor at the Embry-Riddle Aeronautical University in Daytona Beach, Fla. "They're trying to restructure themselves for the future by serving to their strength now."
This will be the first new hub the airline has established in a number of years, US Airways spokesman David Castelveter said. It still has domestic hubs in Philadelphia and Charlotte.
US Airways has 16 daily flights from six gates at the Fort Lauderdale airport.
"The company has been looking for opportunities to expand its Caribbean and Latin American network, and we plan to build on that network in Fort Lauderdale," Castelveter said.
The new international destinations from Fort Lauderdale will include Cancun, Mexico; Guatemala City, Guatemala; Panama City; Santo Domingo, the Dominican Republic; Kingston, Jamaica; and San Salvador, said Michael Linenberg, an analyst at Merrill Lynch & Co.
US Airways, battered by soaring fuel prices and price competition from lower-cost carriers, has said it must trim annual costs by an additional $1.5 billion a year, $800 million of it through employee pay and benefit cuts, by the end of September to avoid having to file for bankruptcy protection for a second time. It is the third time US Airways has sought concessions from workers in three years. During the airline's bankruptcy reorganization last year, employees gave up $1.2 billion a year in pay and benefits.
Despite weeks of concessions talks, no unions have agreed to such cuts -- although the airline was close to an agreement yesterday with its pilots' union. Last week, Glanzer & Co., an independent financial adviser hired by the pilots, said in a report that the airline could file again for protection from its creditors as early as next month and could even face liquidation if it failed to reach new cost-cutting agreements with its unions.