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US Airways Merger Wouldn't Help AMR, Transportation Expert Says

Stocks in this article: AAMRQ.PK DAL LCC UAL

US Airways unsuccessfully pursued mergers with Delta (DAL - Get Report) and United (UAL - Get Report) before pursuing American. As for China, regulators awarded US Airways route authority to fly Philadelphia-Beijing in 2007 and US Airways returned it in 2009.

US Airways spokesman Todd Lehmacher said the carrier gave up its China authority due to escalating fuel prices -- which also caused some peers to return China authorities -- and questions about aircraft capability. US Airways operates A330s, but "the route was at the edge of the range," Lehmacher said. "We would have gone to another aircraft type." He said Airbus A350s are scheduled to begin to arrive in 2017, which "does open additional markets in Asia."

In the meantime, "we've decided to focus in the short term on Europe, which is very successful," Lehmacher said. To South America, US Airways operates Charlotte-Rio flights and hopes to begin Charlotte-Sao Paulo service as well. It has obtained a Sao Paulo route authority, but continues to face delays in securing takeoff and landing times as well as space to park the plane at Sao Paulo's Guarulhos International Airport. In general, Sao Paulo is a difficult place for a U.S. carrier to establish new routes.

Gellman said that US Airways has focused on short-term profitability, "on quarter-to-quarter improvements," rather than taking a longer view which "could lead to lost opportunities in the future.

"I'm not criticizing Doug Parker or his team," Gellman said. "But they have to live with what they've done today for many tomorrows if they don't pay attention."

-- Written by Ted Reed in Charlotte, N.C.

>To contact the writer of this article, click here: Ted Reed

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