ozstamps
Apr 15, 03, 8:29 am
http://biz.yahoo.com/rb/030414/airlines_usairways_codeshare_1.html
NEW YORK (Reuters) - US Airways Group Inc. is pulling in more revenue from its new marketing partnership with United Airlines than it had initially expected, even though United has filed for bankruptcy, a source close to the airline said on Monday.
US Airways, the No. 7 U.S. airline, struck up an alliance last year with No. 2 carrier United that allowed the airlines to combine their ticketing and frequent flyer programs.
Arlington, Virginia-based US Airways, whose routes are largely focused in the eastern United States, has since been able to expand its reach into the west and into new markets that are popular with business travelers.
Some industry experts expected United's bankruptcy in December, and the likely shrinkage of its operations, to reduce the alliance's benefit to US Airways. US Airways had expressed caution over the issue in court statements filed before it emerged from bankruptcy last month.
"To the extent that United's restructuring efforts have a significant effect on its core business, it is likely to have a material negative effect on the alliance," US Airways said in a bankruptcy disclosure statement.
US Airways, which recently emerged from bankruptcy, has said it expects the alliance to help it generate another $200 million in annual revenue once it is fully implemented. United, a unit of UAL Corp. (OTC BB:UALAQ.OB - News), has said it also planned to raise an additional $200 million.
But US Airways' revenue benefit from the tie-up is outperforming expectations to this point, one source said.
US Airways spokesman David Castelveter said on Monday that the number of people who were booking flights generated by the United alliance looked strong, but he said it was too soon to revise any expectations.
"We are very pleased with the initial customer response, but it's too early to be thinking about revising our steady-state forecast," Castelveter said.
United has yet to make any major moves to reduce its passenger capacity or cut back on its route structure, although most airlines scale back the size and scope of their operations while in bankruptcy.
The carrier said a recent 8 percent cutback in capacity was spurred by lower demand due to the war in Iraq. A spokesperson for United did not return a call for comment.
Pension fund executive David Bronner (News), US Airways' new board chairman, said he was not sure how much alliance-based revenue the airline has pulled in to this point, though he said the expected annual benefit to US Airways constituted "huge numbers."
Most of the value in US Airways' alliance with United comes from a limited number of United's flight segments, generally in major markets, US Airways said in a court filing.
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~ Glen ~
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NEW YORK (Reuters) - US Airways Group Inc. is pulling in more revenue from its new marketing partnership with United Airlines than it had initially expected, even though United has filed for bankruptcy, a source close to the airline said on Monday.
US Airways, the No. 7 U.S. airline, struck up an alliance last year with No. 2 carrier United that allowed the airlines to combine their ticketing and frequent flyer programs.
Arlington, Virginia-based US Airways, whose routes are largely focused in the eastern United States, has since been able to expand its reach into the west and into new markets that are popular with business travelers.
Some industry experts expected United's bankruptcy in December, and the likely shrinkage of its operations, to reduce the alliance's benefit to US Airways. US Airways had expressed caution over the issue in court statements filed before it emerged from bankruptcy last month.
"To the extent that United's restructuring efforts have a significant effect on its core business, it is likely to have a material negative effect on the alliance," US Airways said in a bankruptcy disclosure statement.
US Airways, which recently emerged from bankruptcy, has said it expects the alliance to help it generate another $200 million in annual revenue once it is fully implemented. United, a unit of UAL Corp. (OTC BB:UALAQ.OB - News), has said it also planned to raise an additional $200 million.
But US Airways' revenue benefit from the tie-up is outperforming expectations to this point, one source said.
US Airways spokesman David Castelveter said on Monday that the number of people who were booking flights generated by the United alliance looked strong, but he said it was too soon to revise any expectations.
"We are very pleased with the initial customer response, but it's too early to be thinking about revising our steady-state forecast," Castelveter said.
United has yet to make any major moves to reduce its passenger capacity or cut back on its route structure, although most airlines scale back the size and scope of their operations while in bankruptcy.
The carrier said a recent 8 percent cutback in capacity was spurred by lower demand due to the war in Iraq. A spokesperson for United did not return a call for comment.
Pension fund executive David Bronner (News), US Airways' new board chairman, said he was not sure how much alliance-based revenue the airline has pulled in to this point, though he said the expected annual benefit to US Airways constituted "huge numbers."
Most of the value in US Airways' alliance with United comes from a limited number of United's flight segments, generally in major markets, US Airways said in a court filing.
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~ Glen ~
Come visit HERE (http://www.flyertalk.com/forum/Forum13/HTML/000502.html) the most ** FRIENDLY FORUM ** on FlyerTalk. No flame wars, no personal abuse, no substance abuse. Not much of anything really!