US Airways to Focus on Local Traffic, Not Connections
ARLINGTON (Dow Jones) - US Airways Group Inc. plans to transform its busiest hubs, cutting down on connecting traffic and focusing on local travelers, in order to become profitable.
In a publication mailed to employees, the airline said it plans to beef up non-stop flights out of New York's LaGuardia airport, Boston, and Washington's National airport, because those are destinations with a lot of local traffic.
The smaller city of Pittsburgh, on the other hand, will be scaled back to a "focus" city from a hub, the airline said. Charlotte, N.C., on the other hand, will remain a hub, and US Airways will use it as the main international gateway.
"US Airways' schedule will be more focused on larger local markets because that's where yields are highest - and that is where people want to go," the employee newsletter said.
The changes are part of the airline's drive to cut costs in order to compete profitably with low-cost carriers, which have been growing rapidly on US Airways' turf. Plus, giving employees more details of the new strategy coincides with the airline's drive to negotiate new, less-costly labor contracts.
US Airways said in the newsletter that the plan will also improve efficiency, which will lead to furloughs.
The airline said it will use US Airways Shuttle to operate much of the point-to-point flying out of New York, Washington and Boston. At one point, US Airways had considered whether to sell the shuttle, but has since decided against it.
The airline further said it will de-peak the hubs, which means it will spread out departures throughout the day. In the past, the airline had clumped departures around certain times to allow passengers to make quick connections.
De-peaking the hubs will allow the airline to schedule more flights per day for the airplanes, improving the productivity of employees and thus leading to furloughs, the airline said.
US Airways said some smaller markets the airline had served out of Pittsburgh may lose service. The newsletter doesn't say which destinations.
Chief Executive Bruce Lakefield has said he aims to have new labor contracts completed by June, and the newsletter said those contracts should include a profit sharing program for all employees.