US Airways: Give Us Credit For Mergers
TEMPE, Ariz. (
) -- So what if
United
( UAUA) turned its back on
US Airways
(LCC)
as soon as
Continental
(CAL) - Get Report
came calling? Shouldn't US Airways get credit for facilitating airline industry consolidation?
That's the way US Airways CEO Doug Parker sees it. On an earnings conference call on Tuesday, Parker noted that the carrier has participated in merger talks at least three times since 2005. First, US Airways merged with America West. Then it bid for
Delta
(DAL) - Get Report
, prompting a merger with Northwest. Then it bid for United, potentially prompting a deal with Continental.
US Airways has been "helping to influence the industry in a way that has a positive outcome," Parker said. "It's a lot better than it was five years ago -- our industry has become more stabile." Consolidation benefits the industry by taking out excess capacity, Parker said, adding: "That does not mean we need to participate."
US Airways began talking to United months ago, but
dropped out last week, as United executives continued to object to the deal's structure, sources told
TheStreet
.
"As evidenced by today's results, we have a strong stand-alone airline," Parker said. However, asked whether anyone would be left for US Airways to merge with if United and Continental get together, he responded, "We don't believe the door will be closed on future consolidation involving US Airways."
Additionally, President Scott Kirby said a merger between United and Continental could ease the path to "a deeper relationship than we currently have with either one of those." Currently, US Airways is in Star Alliance with the two carriers, but is not part of their global anti-trust immunity alliance. Already, he said, the benefit to US Airways from the Star Alliance amount to hundreds of millions of dollars annually.
During the first quarter, excluding items, US Airways lost $89 million, or 55 cents a share. Analysts surveyed by Thomson Reuters had estimated a loss of 71 cents. Revenue rose 8% to $2.7 billion. Analysts had estimated $2.6 billion. In the same quarter a year earlier, excluding items, US Airways lost $260 million or $2.28 a share. The carrier is predicting a profitable second quarter.
-- Written by Ted Reed in Charlotte, N.C.
.
