This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Firm Hands Reaping Applause at US Air

Siegel says he worked 80 to 100 hours a week and earned the money. "Don't cry for me," he said. "I know the employees went through a lot. But had I kept my old job, and never gone to US Airways, I would have made a lot more money and nobody would have complained about it."

Lakefield Lays Groundwork

When Lakefield succeeded Siegel, the retired Lehman Brothers executive had a single overriding mission: to save jobs. "I didn't really come into this for anything but that reason, and that mission was accomplished," he said in an interview. "Whenever I ride an airplane, and I ride fairly often, more people thank me than I could ever imagine."

Now 62, Lakefield continues to serve as vice chairman of US Airways. Parker paid tribute to Lakefield at the company's annual meeting in April. After describing the financing that helped to establish the new company, Parker noted: "Bruce, to his credit, said, 'I care about that stuff, but what I really care about is saving jobs.' Now 35,000 people work for the largest profitable airline in the U.S."

There were dark days before the merger became reality, however. Early in 2005, US Airways came close to shutting down after it fell out of compliance with loan covenants from its banks, the Air Transportation Stabilization Board and General Electric Commercial Aviation Services.

In February of that year came the first ray of light, unprecedented deals in which two regional carriers invested in US Airways in return for a commitment to contract for their services. The deals inspired other investors. In May, America West agreed to become the first low-fare carrier to take over a legacy carrier.

A one-time submarine officer, Lakefield worked to keep his team focused, even though most members of the management team realized their success would likely result in the loss of their own jobs.

Lakefield "had our jobs in mind -- that was a big thing to him," said Jack Stephan, president of the US Airways chapter of the Air Line Pilots Association. Siegel's principal contribution to US Air was to reduce costs, Stephan said, noting: "Siegel made no change to the structure of the airline. ... It was bankruptcy emergence subsidized by the pilots and the other labor groups."

Pilots, who provided more than $2 billion in pay and benefit concessions to save US Airways, now expect their participation to be rewarded.

"I give Doug Parker the benefit of the doubt," Stephan said. "But he will need a lot more than communication skills to appease this pilot group."

3 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
LCC $0.00 0.00%
AAPL $124.75 0.00%
FB $80.78 0.00%
GOOG $524.05 0.00%
TSLA $206.79 0.00%

Markets

DOW 17,826.30 -279.47 -1.54%
S&P 500 2,081.18 -23.81 -1.13%
NASDAQ 4,931.8150 -75.9760 -1.52%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs