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
TheStreet Open House

US Airways Eyes Merger, Global Growth

Stocks in this article: LCC

TEMPE, Ariz. ( TheStreet) -- US Airways (LCC) foresees that it may one day be involved in a merger, but the carrier made it known that it will not just sit around waiting for one to happen.

US Airways, like most of its peers, is clearly in good shape, and investors are noticing: shares are up 121% this year, leading the industry. At the same time, US Airways remains an outlier. It is neither a global carrier with a vast international network, nor is it a low cost carrier.

US Airways

On an earnings conference call Wednesday, US Airways executives said the company remains interested in a merger, but is also prepared to remain independent while expanding its international network.

"There is enormous shareholder value to be created simply by continuing to do what we're doing," said CEO Doug Parker. Regarding future consolidation, he said, "we are extremely well-positioned if indeed something more happens over time. If the four legacy carriers decide to consolidate to three, US Airways will be involved. Any of the three can do something with us. That's a good position for us and our shareholders."

It remains unclear who would be US Airways' merger partner. Most speculation revolves around American (AMR), which has said it is not interested .

In the meantime, US Airways will grow international, which currently provides only about 21% of total revenue, far below the level of the three other legacy network carriers.

During the third quarter, Continental derived 54% of its mainline revenue from international operations. Delta (DAL) was at 47% and United (UAL) was at 46%. American trails slightly, with about 42% of mainline revenue derived from international, but that number will increase as American is able to take advantage of antitrust immunity agreements across the Atlantic and Pacific.

President Scott Kirby said he views the discrepancy as "a unique opportunity for us." He said US Airways has been expanding service to Europe from Charlotte and Philadelphia over the past few years. Additionally, the carrier began flying from Charlotte to Rio de Janeiro last year and will add Charlotte to Sao Paulo, as well as to Dublin and Madrid, next year.

Looking ahead, US Airways will continue to add service from Charlotte to South America "as opportunities are there and as rights are there." The carrier will also add service from Charlotte and Phoenix to Europe, Kirby said. Eventually, US Airways could fly to Asia as well. It was awarded a Philadelphia - Beijing route in 2007, but decided not to fly when the economy collapsed. Kirby said Asian service is most likely linked to deliveries of the A350, which could begin around the middle of the decade.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!
DOW 16,380.41 +263.17 1.63%
S&P 500 1,886.76 +24.00 1.29%
NASDAQ 4,258.4380 +41.0480 0.97%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs