Airline Posted A 2nd Quarter Loss Of $80 Million

US Airways said Tuesday it had delayed the delivery of 54 Airbus aircraft as part of spending cuts over the next three years aimed at returning the struggling airline to profitability. US Airways said the delivery of the planes, previously scheduled for between 2010 and 2012, would occur in "2013 and beyond."

The deferral will reduce the company's aircraft capital expenditures over the next three years by approximately 2.5 billion dollars, and pare obligations to Airbus and others by 132 million dollars in the near and medium term, the Tempe, Arizona-based airline said in a statement.

US Airways said the aircraft deferrals would not "significantly" alter the airline's capacity plans as aircraft originally scheduled to be replaced will be retained until the rescheduled new aircraft delivery dates. The airline said the moves were taken with key business partners to improve its near-term and future liquidity, estimating they would generate 150 million dollars by year end and 450 million dollars by the end of 2010. "These moves are part of our continuing efforts to improve our balance sheet and return the company to profitability," said Doug Parker, US Airways chairman and chief executive.

In late October the airline said it would cut about 1,000 jobs during the first half of 2010 and reduce service to Europe to battle weak demand amid the global economic crisis. "With these strategic initiatives behind us, we believe US Airways is well-positioned to take full advantage of the recovering economy," Parker said.

The company said it would take delivery from Airbus of two A320 and two A330 aircraft in 2010 and an additional 24 A320 family aircraft in 2011 and 2012. "We have financing commitments for all 28 aircraft and believe this is a more manageable delivery rate given the current economic environment," said Derek Kerr, US Airways chief financial officer.

US Airways also announced that it would delay the start of its operations of the long-range Airbus A350 XWB (Extra Wide Body) aircraft, originally set for 2015, to 2017.

Airbus, a division of the European aerospace giant EADS, intends to launch the A350 as a rival to Boeing's new 787 Dreamliner. The two aircraft projects have encountered delays, with Airbus now planning to deliver its first A350 XWB in 2017, while the first delivery of the Boeing 787 is due in late 2010.

US Airways posted a net loss of 80 million dollars in the quarter ended September 30.

FMI: www.usairways.com