A Sept. 15 Business article incorrectly said that both of Pennsylvania's U.S. senators, Republicans Arlen Specter and Rick Santorum, lashed out at leaders of the US Airways pilots union at a news conference. Only Santorum criticized the pilots. (Published 9/16/04)
The head of US Airways Group Inc. set a timetable yesterday for reducing the airline's costs, telling two Republican senators that failure to do so by January could imperil the carrier's chances of emerging from Chapter 11 protection.
US Airways chief executive Bruce R. Lakefield outlined the airline's restructuring plans yesterday in the 40-minute meeting with Sens. Rick Santorum and Arlen Specter, both of Pennsylvania, where the air carrier has two major hubs.
During the meeting, according to the senators, Lakefield said that unless it reaches an agreement with its workers, the Arlington-based carrier will attempt to modify its labor agreements through the bankruptcy court by submitting proposed contracts to take the place of agreements that are in place.
Santorum described the meeting as "sobering," adding that things were "not looking good" for the airline's survival.
US Airways spokesman David Castelveter declined to comment on the meeting but said the airline "expects to move quickly to achieve its cost-cutting objectives."
Lakefield told the senators that the airline did not have much time to work through negotiations with its employees because it is losing about $1 million a day and has little equipment against which to borrow since most of its aircraft and engines already have liens against them.
While both senators said they were encouraged by Lakefield's management style, both men lashed out at leaders of the airline's pilots union, whom Lakefield has characterized as the reason the airline filed for bankruptcy protection for the second time in two years.
"Lakefield is operating in good faith and is doing a good job," Specter said. "He's the man do to it."
The meeting was scheduled because of US Airways' heavy presence in Pennsylvania, home to a majority of the carrier's employees because of its hubs in Pittsburgh and Philadelphia.
Lakefield told the senators the reason the airline was forced to file for bankruptcy protection Sunday was that four pilots from Pennsylvania refused to allow the airline's new contract to be voted on by the union membership.
"These four individuals decided they wanted to take the airline down, and they did," Santorum said, referring to the pilot leaders who voted against taking the airline's most recent contract proposal to the membership for a vote last week.
Specter said he plans to contact the four pilots to learn why they voted the way they did and the details of their concerns.
Meanwhile, Santorum said, assigning blame to previous management decisions, labor groups or even competitors won't change the fact that the airline industry has changed permanently, largely because of the growth of low-cost carriers. Airline employee contracts need to reflect those changes, he said.
"Every effort will be made by management to keep the airline in operation," Specter said.
US Airways has been trying to secure about $800 million in pay and benefit cuts from its four labor groups as part of its $1.5 billion cost-restructuring program.