TribLIVE

| Business


 
Larger text Larger text Smaller text Smaller text | Order Photo Reprints

Mayors oppose Justice in US Airways merger

On the Grid

From the shale fields to the cooling towers, Trib Total Media covers the energy industry in Western Pennsylvania and beyond. For the latest news and views on gas, coal, electricity and more, check out On the Grid today.

By Philadelphia Inquirer
Wednesday, Oct. 23, 2013, 8:12 p.m.
 

US Airways Group reported Wednesday a lower third-quarter profit than a year ago, as expenses related to its proposed merger with American Airlines and other items offset the benefits of rising passenger traffic and higher average airfares.

The carrier, which is fighting a Justice Department lawsuit challenging the planned merger with American's parent AMR Corp., said net income fell to $216 million, or $1.04 a share, in the latest quarter, from $245 million, or $1.24 a share, a year earlier.

Meanwhile, the mayors of seven of the country's largest cities sent a letter to U.S. Attorney General Eric Holder Wednesday, urging him to “reconsider” the Justice Department's “ill-conceived lawsuit.”

The mayors signing the letter represent cities with airport hubs for either US Airways or American.

“As mayors of some of the largest cities in the United States, we know the airline industry creates jobs, supports local business, attracts new business and promotes infrastructure growth,” the letter said.

The mayors noted the Justice Department allowed Delta-Northwest and United-Continental to merge, and blocking the American-US Airways deal would put their cities at a competitive disadvantage to Atlanta, Newark, and other competing hub airports that benefit from the Delta and United mergers.

The mayors asked Holder to settle the lawsuit and to allow the combination of the two airlines to proceed.

They were: Mike Rawlings of Dallas; Betsy Price of Fort Worth; Patsy Kinsey of Charlotte; Carlos A. Gimenez of Miami-Dade County, Fla.; Michael Nutter of Philadelphia; Greg Stanton of Phoenix; and Rahm Emanuel of Chicago. Dallas-Fort Worth, Miami and Chicago are American hubs, while Philadelphia, Phoenix and Charlotte are US Airways hubs.

Excluding merger-related costs and other special items, US Airways said pretax profit was $367 million, up from $174 million a year ago. Profit came to $1.16 a share, compared with analysts' average estimate of $1.12.

Revenue in the quarter rose 9 percent to $3.9 billion. Passenger unit revenue, the amount for each passenger flown one mile, rose 5.1 percent “driven by a 4.4 percent increase in passenger yield,” a measure of airfare pricing. Mainline passenger traffic rose nearly 6 percent compared to a year ago.

US Airways CEO Doug Parker said, “Our teams continue intensive integration planning work in preparation for our merger with American Airlines.” US Airways and American “remain committed to building a combined airline that can compete in the global marketplace.”

“We are eager to present our case and are grateful for the enthusiasm and support our merger continues to receive,” Parker said.

The Justice Department sued to block the merger in August, contending it would reduce competition and lead to higher fares. A federal court trial in the case is scheduled Nov. 25. A combined American-US Airways would be the world's largest airline.

Subscribe today! Click here for our subscription offers.

 

 
 


Show commenting policy

Most-Read Business Headlines

  1. Energy companies vie for experienced workers with skills in high demand
  2. Energy Spotlight: Adam Pope
  3. Energy-saving tactics pay off in Green Workplace Challenge
  4. Former athletes open businesses
  5. Auto review: Yaris has European flair, efficiency, affordability
  6. Chevron laying off 162 workers from Moon-based unit
  7. Password change can block hackers from wireless cameras
  8. Beaver County power plant cleaning up spill into creek
  9. Workarounds exist for battery woes
  10. Bank of New York Mellon 4Q earnings rise to $793 million, but revenue sluggish
  11. Typewriters back in style, keeping repair shops busy