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US Airways Moves Could Cost 1,000 Jobs

Stocks in this article: LCC

While the America West system bore the brunt of the 2008 cuts, the eastern part of the system will be heavily impacted this time. The 1,000 reductions will include about 600 airport and fleet service workers, 200 pilots and 150 flight attendants. About 165 pilots and 130 flight attendants will come from pre-merger US Airways.

US Airways will also redeploy its remaining 15 E-190 regional jets on Philadelphia- Boston flights and on Boston-LaGuardia shuttle flights, where the load factor on 124-seat Airbus A319s is below 50%. Competitor Delta uses less-spacious E-175s on the route, US Airways said.

In a letter to employees, CEO Doug Parker said the layoffs are difficult but "by focusing on our strengths and eliminating unprofitable flying, we will increase the likelihood of returning US Airways to long-term profitability, which is in all of our best interests." The carrier lost $800 million in 2008, lost money in the first three quarters of 2009, and will likely lose more in the fourth.

"It is obvious that we cannot continue to operate unprofitably forever," Parker said. "It is also clear that the path to sustainable profitability will not simply present itself to us. Any airline 'waiting for the economy to improve' to cure its problems will continue to struggle, and US Airways will not be one of them."

In an interview, Mike Flores, president of the US Airways chapter of the Association of Flight Attendants, said he expects the changes will make the airline stronger, "and I'm fine with that part of it, but I'm not fine with the disruption of peoples' lives while we do this.

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