US Airways Dividend Miles (Pre-FlightFund Merger) - US Airways Says PA Proposal (for PIT) Not Adequate

http://www.pittsburghlive.com/x/tribune-review/news/s_149958.html

What I found really funny is this quote from Roddey:

"They're sending us a clear signal this is not a priority for them," Roddey said. "No meetings are scheduled, which says a lot about their interest in trying to solve the problem."

Has he been following the same news I have? They have pretty much said all along they are not interested. If we will offer them the world on a silver platter, then they will stay.....but I don't think US has ever given the impression they really need/want to keep operations in PIT.

I wish they would just pull out already - they aren't worth one penney more of my tax dollars. Bring on the others!!!

Another story from yesterday that kind of predicts the response we received above:

http://www.post-gazette.com/localnews/20030815usairwaysreg3p3.asp

[This message has been edited by jkzahn (edited 08-15-2003).]

"Disingenuous" is how I would describe Allegheny County Chief Executive Jim Roddey's comments http://www.flyertalk.com/forum/wink.gif

Has the guy been asleep for the last year? Regardless of how you feel about the airlines behavior this guy is out of his depth and has been right along.

Well said Tom,
I happened to be in PIT at the main club when Roddey, Siegel, Chiames and their respective crews were meeting.

You should see this nit wit Roddey! everyplace he goes he has a security detail. If you see a balding man in PIT surrounded by an entourage with several beefy security guards from the the Alleg. County Sherriff's Department then you've seem Jim Roddey. I see hime off and onn there. Wonder why no one has made mention of how much all of his security cost taxpayers?

Contrast that to Mr. Siegel who wanders about the airport like a lost customer, albeit a lost customer with a very expensive and finely tailored suit. To me that says something about the 2 people and their respectives veiws of their own importance.

On this one I'm sorry to say to all of the great posters from PIT, I'm on Airways side and I wouldn't back down, not when I hold most of the cards. I mean c'mon with $9.00 per passenger cost who else would commit to PIT? The only thing I dislike more then arrogant, out of touch airline executives is, Little power hungry tin horn government officials who have sucked off the taxpayer teet and have no clue what it is to actually work in a profit making enterprise.

[This message has been edited by PineyBob (edited 08-15-2003).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
The only thing I dislike more then arrogant, out of touch airline executives is, Little power hungry tin horn government officials who have sucked off the taxpayer teet and have no clue what it is to actually work in a profit making enterprise.
</font>


WOW!!! PineyBob must have hit the caffeine pretty hard this morning! http://www.flyertalk.com/forum/biggrin.gif

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by TomBascom:
"Disingenuous" is how I would describe Allegheny County Chief Executive Jim Roddey's comments http://www.flyertalk.com/forum/wink.gif

Has the guy been asleep for the last year? Regardless of how you feel about the airlines behavior this guy is out of his depth and has been right along.</font>

Here in Allegheny County, this is the way most problems get solved. Leaders sit there with their eyes closed and hope that the issues will blithely melt away. Its a great way to run a county...right into the ground.

I think no matter which side of the fence you sit on regarding this issue (airline vs. county), the common denominator is that we just wish it would end quickly and mercifully. PIT will be fine with or without US Airways...its just a matter of re-inventing ourselves from a marketability standpoint should US Airways decide to flee. Everything will work itself out in the end http://www.flyertalk.com/forum/smile.gif



------------------
"A mile of highway will take you a mile, but a mile of runway will take you anywhere."

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by geo1005:

WOW!!! PineyBob must have hit the caffeine pretty hard this morning! http://www.flyertalk.com/forum/biggrin.gif
</font>

Naw, he's just putting together Roddey's next job description -- TSA screener!

Let's not forget that it was Siegel who was disingenuous with PIT when he cancelled leases at the last moment, after committing not to do so. PIT's costs (per passenger) keep going up because US has taken so many flights out of the facility.

If US would have cancelled these leases during BK, Allegheny County would own half of the company. You're selling him short if you think that Roddey has been beat on this. He didn't make this situation, but IMHO has the tools to negotiate the best for PIT/Ally County.

US doesn't hold all of the cards, both PIT and PHL are in the same state that US needs beaucoup $$ from.

Because it's a package deal with PIT and PHL, it makes it more interesting on what will happen next.

I spoke with Roddey a few times when I wrote to him protesting the US/UA merger. I can say he definitely has his head in the sand about anything airline related.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by HPTunco:
PIT's costs (per passenger) keep going up because US has taken so many flights out of the facility.</font>


Not true. PIT's costs per passenger were 3 times those of CLT before US pulled a single flight.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by HPTunco:
Let's not forget that it was Siegel who was disingenuous with PIT when he cancelled leases at the last moment, after committing not to do so.</font>

The only source that I'm aware of for that contention is Roddey.

IMHO it lacks credibility to claim that US gave PIT no indication prior to the last minute rejection of the lease.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">PIT's costs (per passenger) keep going up because US has taken so many flights out of the facility.

If US would have cancelled these leases during BK, Allegheny County would own half of the company. You're selling him short if you think that Roddey has been beat on this. He didn't make this situation, but IMHO has the tools to negotiate the best for PIT/Ally County.

US doesn't hold all of the cards, both PIT and PHL are in the same state that US needs beaucoup $$ from.</font>

We'll see.

My bet: US pulls out of PIT and hardly anyone notices.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by geo1005:

WOW!!! PineyBob must have hit the caffeine pretty hard this morning! http://www.flyertalk.com/forum/biggrin.gif

</font>

Actually exactly the opposite. I am tired and cranky after flying in from SNA into the darkness. SNA to PIT was probably one of the nicest rides I've ever had since I started flying. PIT to PHL was another story. My head still hurts from having the flight attendent slam an overhead into it! I know I'm a hard head but geez I saw stars. Then I get a totally drunk woman in a way to short skirt wanting to talk even though she really couldn't. Given her condition and the shortness of her skirt, I got quite a "show". Not a pleasant experience given we had to go down to DCA for ATC as NYC was down which prolonged the agony. By the time I got home it was 3AM. So PineyBob is NOT a happy camper today

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by geo1005:

Not true. PIT's costs per passenger were 3 times those of CLT before US pulled a single flight.

</font>

Due entirely to the debt incurred building a facility to US Airways' exact specifications.

Don't lose sight of the fact that PIT's debt is due entirely to US' previous demands for the facility. Not the county.

And Bob--Roddey is a Republican running the 2nd or 3rd most infamous "democratic machine" counties in the country. He made himself a rather large pile of money before starting into public service. Those of you who think he has anything to gain by fibbing about what he did not know with regard to US bagging the leases "Baltimore Colts" style are drinking too much of the Ben B. Kool-Aide. He inherited the debt mess that is the Greater PIT airport. Without defaulting on that debt (it has already been refinanced) and/or raising taxes, exactly how would you handle the problem?

I hope he gets the $9 cost down. Based on the "snow job" that US pulled at exit-20 minutes on the leases, I hope some other airline is the beneficiary of said reduced costs.

Life will go on. Other airlines are already increasing service and frequency due to the US pulldown. Enjoy that connecting facility at PHL, folks.....

------------------
Saving the world, one clue at a time.

What you see as a "Snow Job" I see as smart business. Roddey cavorts around PIT with his entourage and Beefcake Goon squad like he is the Godfather of PIT. What the blank does Jim Roddey need 2 bodyguards and an aid or two to follow him around?

Regardless of whether or not US misled PIT right up to the last minute it was just plain stupid for Roddey to have not been prepared for some such. Business as usual ended when they filed chapter 11. He had the examples of the labor groups, the creditors and the customers to look to. He should have seen it coming and been ready for it.

I don't much care if U dictated the entire design of the airport etc, etc. They dug the entire hole they're in -- the labor contracts, the plane leases, the insane fare structure and the airport leases. Just like the lease holders on the aircraft and everyone else (except the customers -- who hold the only real power in this game; but who are unfortunately too disorganized to wield that power) the county should have expected to deal the minute they went into chapter 11. There was no reason to think they were special and that half a billion dollars was going to be ignored as a gift to the fine citizens of Pittsburgh.

Everytime this guy opens his mouth he's painting this picture about how surprisingly unfair the awful people from US Airways are. How much longer is he going to be surprised?

BTW -- I do enjoy PHL. It's a great airport. CLT is pretty nice too, I expect I might see more of it next year.

[This message has been edited by TomBascom (edited 08-15-2003).]

The 20 minute notice that was given to Allegheny County (after telling county officials throughout the BK period that they WOULD NOT cancel the leases) is all of the evidence that one should need in knowing that you can't negotiate with USAirways in good faith.

US needs $$$ from the State of PA for PHL as much as they need to get out of PIT. I hope that we'll use the $$$ that would have gone to US to put together a package attractive enough to bring other carriers to PIT.

The fare structure, not costs in PIT, is what have US bleeding cash. I don't see any changes in the fares......so the situation with US won't change in the long term anyway.

First things first. . .this is not a pittsburgh versus US issue. Both of them are linked at the right ventricle. US has 80%--yes 80% of the flights at PIT. If US left--Roddey would be walking through PIT filling it up with that expandable foam stuff---in addition to beefing up the local unemployment offices for thousands of new applicants. Not even mentioning the economic impact on the Greater Pittsburgh area of lost convention revenue etc etc.

If US pulls out--imagine the cost per passenger for the remaining few airlines there. They might as well turn PIT into the farmland it was. . .

Finally, PIT is--at least on many long-hauls the cheapest (sometimes too cheap) in the US network. I have been picking up PIT-SFO, PIT-LAX for like $198 round trip. Sometimes with 24 hours notice. However short-haul fares have stayed relatively high.


[This message has been edited by NeoOfTheCRS (edited 08-15-2003).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by HPTunco:
The 20 minute notice that was given to Allegheny County (after telling county officials throughout the BK period that they WOULD NOT cancel the leases) is all of the evidence that one should need in knowing that you can't negotiate with USAirways in good faith.

US needs $$$ from the State of PA for PHL as much as they need to get out of PIT. I hope that we'll use the $$$ that would have gone to US to put together a package attractive enough to bring other carriers to PIT.

The fare structure, not costs in PIT, is what have US bleeding cash. I don't see any changes in the fares......so the situation with US won't change in the long term anyway.</font>

You are making the assumption that a government official is telling the truth. Do we have 3rd party coroboration that Mr. Roddey has even a passing aquaintance with the truth? Most government officials don't. Need I remind you of Nixon, Iran/contra, Ruby Ridge, Watergate and the litany of public officials who are not only liars cheats and thieves but in many cases are convicted liars, cheats and theives.

Why does everyone assume that Mr. Roddey is telling the truth? I certainly don't.

He looks and sounds like a self absorbed ego-maniacial politican who came armed with a knife to a gunfight and got himself snookered. Now in order to save face he creates a story out of to me at least appears to be thin air to hide his inneptitude as a negotiator.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
You are making the assumption that a government official is telling the truth. Do we have 3rd party coroboration that Mr. Roddey has even a passing aquaintance with the truth? Most government officials don't. Need I remind you of Nixon, Iran/contra, Ruby Ridge, Watergate and the litany of public officials who are not only liars cheats and thieves but in many cases are convicted liars, cheats and theives.

Why does everyone assume that Mr. Roddey is telling the truth? I certainly don't.

He looks and sounds like a self absorbed ego-maniacial politican who came armed with a knife to a gunfight and got himself snookered. Now in order to save face he creates a story out of to me at least appears to be thin air to hide his inneptitude as a negotiator.</font>

Unlike the examples you give, there is a paper trail to the progression of these events. It's called Federal Bankruptcy Court. Why does anybody even begin to give USAirways the benefit of doubt in a situation where they are accused of improper business practice? Their record should speak for itself.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by HPTunco:
Unlike the examples you give, there is a paper trail to the progression of these events. It's called Federal Bankruptcy Court.</font>

Can you point to something in that paper trail that substantiates Roddey's contention?

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Why does anybody even begin to give USAirways the benefit of doubt in a situation where they are accused of improper business practice? Their record should speak for itself.</font>

Leaving aside the question of "improper" -- That's exactly what the people of Pittsburgh ought to be asking Mr. Roddey. How could he have been so complacent? Why is he continually surprised? It should have been obvious to him that he needed to have a contingency plan in place. It's not like there weren't plenty of examples for him to learn from.

[This message has been edited by TomBascom (edited 08-16-2003).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by NeoOfTheCRS:
Finally, PIT is--at least on many long-hauls the cheapest (sometimes too cheap) in the US network. I have been picking up PIT-SFO, PIT-LAX for like $198 round trip. Sometimes with 24 hours notice. However short-haul fares have stayed relatively high.</font>

This particular phenom is due entirely to the America West flights to PHX. US is trying (and fortunately, failing) to run them out of town.

The intra-east fares are still astronomical.


------------------
Saving the world, one clue at a time.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
Why does everyone assume that Mr. Roddey is telling the truth? I certainly don't.

He looks and sounds like a self absorbed ego-maniacial politican who came armed with a knife to a gunfight and got himself snookered. Now in order to save face he creates a story out of to me at least appears to be thin air to hide his inneptitude as a negotiator.</font>

You realize that Roddey had more money than most before he ran for county exec in PIT, right? Earned. He literally does not need the job. I suggest that you read a bit about the man's history before you simply assume that he's another politician who just fell off the turnip truck.

So, here's a guy who made a pile of money in business, and probably asked US for their demands early on in the BK process.

Knowing they had to deal with someone with some business acumen (as opposed to the typical Agh. County democratic machine puppet types), they suckered the ACA at the 11th hour.

I've still yet to hear from any of the naysayers just exactly what their solution would be to the problem in PIT, US staying or US going. It's always easier to be the proverbial armchair quarterback....


------------------
Saving the world, one clue at a time.

[This message has been edited by ClueByFour (edited 08-16-2003).]

http://www.pittsburghlive.com/x/tribune-review/news/s_150141.html

Update about how Roddey has just about had it with US and is now out shopping.....

Everyone is making valid points, but these issues are all in the past.

Did Roddey adequately prepare a contingency plan just in case something went awry? not really.

Did US Airways excercise good business practice by announcing their intentions of cancelling the lease in the 11th hour, even though they were legally allowed to do so? not really.

You could argue either of these points (as well as others) for or against, but the current situation hasnt changed:

Allegheny proposed a plan to US Airways. US Airways sat on it for awhile and then said its "not adequate." Roddey is peeved.


I think the real question, and probably the intent of the topic's original poster, is...

what happens now?

------------------
"A mile of highway will take you a mile, but a mile of runway will take you anywhere."

forgot to add...

Last week, Roddey was on KDKA radio here, and alluded that we could hear an announcement soon regarding a new carrier at PIT. his timeline for this announcement was "possibly with the next two weeks." Don't know if any other 'burghers heard that interview...but maybe we'll hear more in the next week or so.


...Frontier perhaps? They may want to be "testing" a market or two for their own plans to possibly add a hub. Don't quote me on that...it was just based on what I've heard regarding their spat with United and Denver.

------------------
"A mile of highway will take you a mile, but a mile of runway will take you anywhere."

The Trib article said four airlines were interested in PIT IF USAirways pulled out. I also find it interesting that the voters in the area -- ie the flight attendant and pilots union -- have also asked for Roddey to give USAirways the finger (whether or not they accurately reflect membership is a question for usaviation.com, I guess)

I hope we take some of the money budgeted for USAirways, pay for some retraining and assistance for those that will be laid off along with the support personnel not directly employed by USAirways, and move on with our airport life.

PS -- This article
http://www.pittsburghlive.com/x/tribune-review/news/s_140211.html

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">"We have been actively discussing with JetBlue, Frontier, Alaska, Southwest and Spirit Airlines opportunities at Pittsburgh," said Kent George, the authority's executive director. </font>

After flying JetBlue in Long Beach, it would be sooo sweet to have them in Pittsburgh. Maybe a bit more attainable than Southwest, IMHO.


[This message has been edited by pitflyer (edited 08-16-2003).]

That is too funny. None of these other guys are going to play in PIT because the fixed costs of operating in PIT are too high. As recently reported:

"US Airways now pays $50 million of the airport's $62 million in annual debt repayment costs."

Now Roddey and some of you guys think southwest, jet blue or some other player is going to agree to pay even $10million for the privledge to fly out of PIT. BUNK!

PIT will end up in banruptcy if US leaves and Roddey will be deciding what crops to plant on Farm PIT!!

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pitflyer:
The Trib article said four airlines were interested in PIT IF USAirways pulled out. I also find it interesting that the voters in the area -- ie the flight attendant and pilots union -- have also asked for Roddey to give USAirways the finger (whether or not they accurately reflect membership is a question for usaviation.com, I guess)

I hope we take some of the money budgeted for USAirways, pay for some retraining and assistance for those that will be laid off along with the support personnel not directly employed by USAirways, and move on with our airport life.

PS -- This article
http://www.pittsburghlive.com/x/tribune-review/news/s_140211.html

After flying JetBlue in Long Beach, it would be sooo sweet to have them in Pittsburgh. Maybe a bit more attainable than Southwest, IMHO.


[This message has been edited by pitflyer (edited 08-16-2003).]</font>

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by jkzahn:
http://www.pittsburghlive.com/x/tribune-review/news/s_150141.html

Update about how Roddey has just about had it with US and is now out shopping.....</font>

Oh really??? And where is he shopping? "Airline's is Us" Like an LCC would pay Neiman Marcus for a Macy's product!

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
Oh really??? And where is he shopping? "Airline's is Us" Like an LCC would pay Neiman Marcus for a Macy's product!</font>

What makes you think they won't? In the past year, both America West and ATA have brought operations to PIT, and done well.

Further, what makes you think that Roddey might not be willing ot cut somebody else a better deal that he's currently tabled with US?


------------------
Saving the world, one clue at a time.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by ClueByFour:
What makes you think they won't? In the past year, both America West and ATA have brought operations to PIT, and done well.</font>

I'm sure he'll manage to bring in a carrier or two. But a few flights here and there is a far cry from replacing hub operations.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Further, what makes you think that Roddey might not be willing to cut somebody else a better deal that he's currently tabled with US?</font>

He might do it out of spite. But is that really sensible? If he can strike a better deal wouldn't he be better off keeping as much of the hub as he can?

My solution (since we "naysayers" are said not to have any...) is that he should make a sincere effort to address the cost problem. So far he's as bad as Dave and the boys -- he seems to be pretending that he didn't hear that part of US' complaint. It's no wonder that US hasn't responded to his proposal. He basically hasn't made one.

I don't know the details so I can't really comment on his options but perhaps he reschedules the debt or makes some cost cutting changes. But ignoring it certainly won't make it go away.

He needs to make the requested improvements in any event and is apparently planning to.

He should have been aggressively pursuing other airlines all along. It's nice to see that he's finally supposedly moving on it but it raises another question for voters -- what took him so long to wake up to that?

I seriously doubt that he's going to get somebody else to hub at PIT any time soon.

I don't think Roddey has ever said anyone else will open a _hub_ here. I think it is natural to expect more flights from more carriers after USAirways leaves, not a hub. Also, I believe that the debt payments on the loan will be refinanced over a longer term, with possibly some of it unfortunately being defaulted on, lowering Allegheny County's bond rating .. but that's why we have insurance. Possibly an assessment in the Pittsburgh MSA to cover the costs of the USAirways/Pittsburgh blunder.

Keeping USAirways in Pittsburgh is like giving an adrenalin shot to an almost-dead horse. Yes, it'll keep running for a bit, but it's gonna die soon.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by ClueByFour:
What makes you think they won't? In the past year, both America West and ATA have brought operations to PIT, and done well.

Further, what makes you think that Roddey might not be willing ot cut somebody else a better deal that he's currently tabled with US?


</font>

Clue,
I don't know Jim Roddey from your Aunt Millie, but I will tell you what i have observed. I have observed a man who has somehow managed to get most interested parties to believe that US did't "Play Fair" with rejecting the leases while in BK. No one at least on this web site or us aviation has provided any supporting documentation or 3rd party coroboration of ANY of Mr. Roddeys comments regarding the cronology of events. He travels with more security than former Govenor Whitman does here in New Jersey! That to me speaks volumes about his ego and his sense of self importance. One of my biggest regrets since I have began posting here is that I made the false assumption that those men were Dave Siegel's! When in fact they belong to the Imperial Wizard of the Airport, Mr. Roddey. He stands in stark contrast to Dave Siegel, who if you hadn't seen his picture in Attache you would never would have known he was the CEO of the 7th largest Airline in the USA.

So let's assume that US did reject the leases at the eleventh hour, knowing Dave and their counsel's attention to detail don't you think they had tried to work something out and when push came to shove US played it's trump card and left the Imperial Wizzard holding his leases that now have essentially the same value as Charmin?

As for the State of Pennsylvania, the $264 million in aid offered is an insult given that the 4 major sports teams recieved in excess of a billion dollars for new stadiums. Then throw in the $322 for the Norwegian shipbuilder to locate a shipyard at the Philadelphia Naval Shipyard. That deal works out to around 50,000 per job, per year and Kavearner is only committed to building three ships! After that it can walk away.
Then we have the walking Fraud, "Fast" Eddie Rendell who as district attorney knowingly put an innocent man on death row. Check out Commonwealth vs Neil Ferber.

So here you have a sharp hard working businessman doing ALL he can the best way he knows how to turn an airline that has been on the financial respirator for years around in the face of unpreceedented adversity versus several public officials who for many years have earned their living suckling at the taxpayer teet. Wonder when either of them last earned a paycheck from private enterprise. The 11,000 or so workers that live in PA and work for US have payed plenty of taxes over the years it's time for the state to issue a refund on them and and advance on them in the future by stepping up to the plate and delivering the type of aid package that will give US Airways a competitive advantage, that will help the local economies of 2 major cities and help US remain a free standing airline.

[This message has been edited by PineyBob (edited 08-17-2003).]

No other airline (LCC or major) is looking for or needs a new hub operation. PIT may attract a few new carriers but they will do nothing more that run a few flights to their hubs or to a couple of major cities (Chicago, NYC, Boston perhaps) but NO airline is going to come in and provide the number of flights US offers. And let's be real honest here, a second/third tier city (talking O&D here folks - nothing personal) like PIT doesn't warrant that level of service. All the non-stops the residents of PIT have enjoyed are a function of US's utilization of PIT as a HUB, not because the population of PIT called for it. And while an airport like CLT may not have the huge O&D traffic US would like - they have geography on their side - they are US's southern hub.


As for trying to get the lease rates down - how many of you have refinanced your mortgage in the last year or so? Why would ANYONE think that US would not do the same? And btw, "because they said so" is not a good answer.

USAirways did what is best for them and legal (whether it was ethical is another argument) at the time. It's time for Pittsburgh to cut its losses and move on. It was a mistake to hitch the airport to USAirways specifications -- kinda like being loyal to a company these days. It used to work in the past (ie you'd have a job for life if you worked hard and were loyal, and the company would take care of you when you retire) but it's a different environment now.

USAirways needs to consolidate its hubs to PHL and CLT, so it can shrink to profitability, or add another 20 minutes to the padded PHL schedule and lose more bags http://www.flyertalk.com/forum/smile.gif We need to bite the collective bullet in the Pittsburgh metro and give up on our non-stop service to places like Norfolk for a more right-sized operation.

That, my friend, is incredibly short-sighted. Sure chase US out. The only thing they will be building in PIT are new unemployment offices. Thousands of airline jobs evaporated and probably tens of thousands support jobs eliminated too!

Not to mention lost tourism and convention revenue. Additionaly, major Fortune 500 companies would put a big red X on Pittsburgh as a place to do business. One of the key criteria to locating in a city is the level of air service.

Then you will have a bankrupt airport with a 75% reduction of flights.

As for US, they are already shrinking into non-existance. But if they would try to shift 20% of PIT flights to PHL, PHL will collapse like a deck of cards.. . Hello to bankruptcy #2

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pitflyer:
USAirways did what is best for them and legal (whether it was ethical is another argument) at the time. It's time for Pittsburgh to cut its losses and move on. It was a mistake to hitch the airport to USAirways specifications -- kinda like being loyal to a company these days. It used to work in the past (ie you'd have a job for life if you worked hard and were loyal, and the company would take care of you when you retire) but it's a different environment now.

USAirways needs to consolidate its hubs to PHL and CLT, so it can shrink to profitability, or add another 20 minutes to the padded PHL schedule and lose more bags http://www.flyertalk.com/forum/smile.gif We need to bite the collective bullet in the Pittsburgh metro and give up on our non-stop service to places like Norfolk for a more right-sized operation. </font>

NeoOfTheCRS: Remember that US is not in the business of helping PIT. US is in the business for US. http://www.flyertalk.com/forum/smile.gif

Geo,

I agree completely. If that was the case we would not be having this conversation. However, people in PIT telling US to take a hike are not looking at the full economic benefit that being a hub city delivers.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by geo1005:
NeoOfTheCRS: Remember that US is not in the business of helping PIT. US is in the business for US. http://www.flyertalk.com/forum/smile.gif</font>

I feel the ideal situation for PIT would be if HP would re-think the east coast hub and have it in PIT. CMB failed because the OD traffic there doesnt support it-its less than half the O&D at PIT.
This will never happen, but that's what I'd like to see.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by NeoOfTheCRS:
Geo,

I agree completely. If that was the case we would not be having this conversation. However, people in PIT telling US to take a hike are not looking at the full economic benefit that being a hub city delivers.

</font>


500,000,000 dollars that US wants. 8,000 jobs or so that would leave.

$62,500(of taxpayer/state/local money)/job. Let 'em go.




------------------
Saving the world, one clue at a time.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by ClueByFour:

500,000,000 dollars that US wants. 8,000 jobs or so that would leave.

$62,500(of taxpayer/state/local money)/job. Let 'em go.</font>

Those are direct jobs. There is also a "trickle down" effect -- it takes a lot of burger flippers, checkout clerks and postmen to support 8,000 wage earners...

Since the fare structure hasn't changed (if anything it's worse), I expect US and the other major airlines to be back in BK court sometime soon. It's a bad investment for the taxpayers of PA to continue to throw money at them when the outcome is easily predicted.

If we can get AW, or another "low cost" airline to come to PIT, let's do it.....give them the $$$.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by ClueByFour:

500,000,000 dollars that US wants. 8,000 jobs or so that would leave.

$62,500(of taxpayer/state/local money)/job. Let 'em go.




</font>

Would it be safe to assume your math divides the 500 Million over a one year period? or did you factor in the impact of multiple years, growth at MDA? Ripple effect on serive industry jobs? and if we contrast the nearly $600 million given to the Pirates and Steelers for how many jobs and what kind of ripple effect?

Aiding US is a bargain compared to the recent history in PA and factoring in all of the benefits to the state in general

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
Aiding US is a bargain compared to the recent history in PA and factoring in all of the benefits to the state in general</font>

recent history-- Now there's a shopping cart chock full of bargains...

benefits to politicians, perhaps. benefits to taxpayers? meh.

I did not support the funding for the stadiums. I do not support the funding for the Pittsburgh Penguins arena -- and I'm a big FAN of the Pens. Similarly I do not support funding for USAirways, which like the Pirates and the Penguins, are probably money-pits with no future in sight.

We've been through a lot of hard times in Pittsburgh since the industrial revolution and this will just be another. It is _not_ the end of the world.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pitflyer:
I did not support the funding for the stadiums. I do not support the funding for the Pittsburgh Penguins arena -- and I'm a big FAN of the Pens. Similarly I do not support funding for USAirways, which like the Pirates and the Penguins, are probably money-pits with no future in sight.

We've been through a lot of hard times in Pittsburgh since the industrial revolution and this will just be another. It is _not_ the end of the world. </font>

Actually I tend to agree with you! BUT, as we say with our children, "you do for one, you have to do it for all", which is the ONLY reason IMO to provide "incentives" to private organizations. Their is predecedence here to have the state involved in a big way.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
Their is predecedence here to have the state involved in a big way.</font>

So Allegheny County makes a monstrous mistake and funds an albatross, lets have the State prolong the natural market contraction for USAir? Then the all of PA Tax Payers can pay and pay and pay. Don't forget, I'm sure a lot of the courteous US PHL airport crew live in New Jersey. Maybe Jersey wants to help a brother out? A little sanity in the all of the silliness, City of Pittsburgh funded the reclamation of one of the Old J&L Steel mills and created over 1500 hi tech jobs in conjunction with CMU and U of Pitt for less than $150 million. I don't see the stadiums creating those kind of jobs. Lesson to Allegheny County and Piitsburgh, education and healthcare is where you need to give tax incentives and corporate welfare. Don't compete with larger cities unless you can win. Can you say Convention Center??? Another pit for which to throw the Taxpayers dough ray me into. I am a born and bred Yinzer from the Da Burgh and hate to see the jobs lost, but Pittsburgh survived the Death of the Steel Industry and will again re-invent itself. Pittsburgh engineered the textbook 20th Century Urban Renaissance. I'm certain the good folks of Pittsburgh will do just fine with a smaller US presence.

The Big Six needs to become the Big Three and will. Any airline that ties itself to an ERJ strategy deserves to die. I don't follow Southwest, Jet Blue etc, but I don't see a whole lot of ERJ's in their plans. Go ahead and make flying even more uncomfortable than it is and you will see a lot of us airline point -hores decide to sit on our collective arse's..
EOR.

G

Fast Eddie has a card to play with PHL. He can pressure U to keep PIT by making PHL very expensive for U to keep alone. And U has no leverage in PHL, it's there crown jewel and they have no alternative. I assume Eddie is cranking up the pressure as we speak.

Maybe it's just wishful thinking on my part. I'm dreading the days of, "we are number 40 for takeoff" at PHL after PIT closes.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PineyBob:
Actually I tend to agree with you! BUT, as we say with our children, "you do for one, you have to do it for all", which is the ONLY reason IMO to provide "incentives" to private organizations. Their is predecedence here to have the state involved in a big way.</font>

'Me too' has got to stop somewhere. When the city (Pittsburgh) can't even afford to keep basic services running and is cutting police and many community services, I'd much rather see that funded than prop up another dying airline.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by veliger:
I'm dreading the days of, "we are number 40 for takeoff" at PHL after PIT closes.</font>

Don't think you will have to worry much about that. After WN opens up their east coast operations in ABE. PA will be bailing out US in PHL.

Didnt see it mentioned - buried in the press releases and article excerpts was a quote from USAirways discussing how they had to hire some outside consultants who were experts in the area of municipal finances to help them respond to the $260M offer from PIT/PA.

If we take their word (I know, thats hard), then thats actually a pretty positive sign. Means they are:

* Spending money to study the problem
* Actually trying to suggest ways to get closer to $500M
* Maybe half serious about staying in PIT?

couple of small updates today - basically response is coming soon but sounds like US is sticking to their guns trying to say PIT will recoup their costs in 100 days (yeah, right - talk about "fuzzy math"):

http://www.post-gazette.com/pg/03232/212966.stm

http://www.pittsburghlive.com/x/tribune-review/news/s_150799.html

jkzahn - you mean you read things besides the bonus code thread? ;-)

I worry that all of US' response is going to be WHY they should invest $500 million rather than HOW they could invest that money (ie they dont have it!).

2 thoughts:

1) While I agree that the PIT hub is worth a lot of money to the state, but from the state's perspective, its 2.5% from personal income taxes, the state share of corporate income tax, etc. So if the airport generated $500 million per year, fine, but the state only gets a few percent of that. At 2.5%, the state would wait 40 years to get the money back (and thats not considering the time value of money).

2) Fine that the hub is worth money, argue above how much. Then use their same logic to ask what about the loss of value, jobs, etc, that the airline has imposed on the state by shrinking over the last 2 years? Thats in the $500 million range already. USAirways needs to do something extraordinary just to get back to 'original par'.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by jkzahn:

http://www.pittsburghlive.com/x/tribune-review/news/s_150799.html</font>

Wow, read this article closely ... in particular this:

<font face="Verdana, Arial, Helvetica, sans-serif" size="2"> In exchange for state aid, however, the governor wants US Airways to operate at least 500 daily flights at Pittsburgh International and to employ at least 8,000 workers.</font>

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">The airline has cut Pittsburgh flights to fewer than 400 a day from more than 500 two years ago.</font>

So basically the state came back with an offer of 1/3 what US asked for in dollar terms and included the condition that US would have to add over 100 daily flights compared to what it's operating now. I'm sorry folks, but that's a ridiculous counter-offer. Even if US were to agree to split the difference in dollars, I don't see how they can agree to add back a significant number of flights.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by HPTunco:
If US would have cancelled these leases during BK, Allegheny County would own half of the company. You're selling him short if you think that Roddey has been beat on this. He didn't make this situation, but IMHO has the tools to negotiate the best for PIT/Ally County.

US doesn't hold all of the cards, both PIT and PHL are in the same state that US needs beaucoup $$ from.</font>

The lease was cancelled in bankruptcy ... how else could it have been cancelled?

Also, PIT is getting a piece of the company from the bankruptcy proceedings ... it's going to be a relatively small piece, but they are getting something none-the-less.

Re: the 500 flight demand. I think that includes MidAtlantic flights, which in USAirways' theory should be up that area (~100 mainline, ~400 MidAtlantic) but of course USAirways doesn't want to commit. Similarly the state doesn't want to throw more money down the toilet so it can send more jobs to Charlotte....

Not to be picky, but even if US "pulled out" of the hub, I would imagine they'd still remain one of the largest carriers in PIT, with flights to PHL and CLT of course along with DCA, LGA, and probably even BOS .... probably still around 25 flights/day I would guesstimate. There would probably still be a lot of folks who would still fly them for business who wouldn't take their departure as personally as the average FT'er.

The talk of other carriers coming in sure seems like nothing more than talk to me. No LCC is going to add a significant number of flights (and jobs) to PIT at the prices US is paying ... and if you're going to make some sweetheart deal, why make it to someone else ... spite is not the beast reason for choosing a particular negotiation tact when you're dealing with the livlihood of at least 8,000 people. Even if you make a sweetheart deal to someone else, there's no way they're bringing in any where near the number of jobs (I doubt they could attract a maintenance facility, I don't think anyone is looking to add one) and flights US already has.

BTW, I don't like to get into "trickledown" too much, but let's just look at jobs at the airport ... I would think there would be a significant reduction in jobs at the airport if US cut its flights by 90%, say 300 flights/day gone. Even if other carriers added capacity, how much capacity you think they're going to add? Best case, I think PIT would have to board up two of its four main concourses ... I can't imagine they're going to need more than the 40-50 gates you have in two concourses ... all the businesses and support folks for those other two concourses ... buh bye.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pitflyer:
Re: the 500 flight demand. I think that includes MidAtlantic flights, which in USAirways' theory should be up that area (~100 mainline, ~400 MidAtlantic) but of course USAirways doesn't want to commit. Similarly the state doesn't want to throw more money down the toilet so it can send more jobs to Charlotte....</font>

That sounds like a reasonable explanation, but I question whether US has ever said MidAtlantic would have 400 flights/day to/from PIT ... that's awfully high. I just don't see US adding over 100 flights at PIT even with RJ's replacing mainline ... that's an awful lot of frequency being added.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Beckles:
The lease was cancelled in bankruptcy ... how else could it have been cancelled?

Also, PIT is getting a piece of the company from the bankruptcy proceedings ... it's going to be a relatively small piece, but they are getting something none-the-less.</font>

Specifically the leases were cancelled with 20 minutes to go before US emerged from BK protection. Not enough time for Allegheny County to react.

Yes, technically the leases were cancelled DURING BK, but the insidious way that it was done can only highlight US's intention to defraud Allegheny County.

Beckles is right. Only thing I would add is with 80% of the flights out of PIT, they would still be the largest carrier if the only had flights to CLT and PHL.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Beckles:
Not to be picky, but even if US "pulled out" of the hub, I would imagine they'd still remain one of the largest carriers in PIT, with flights to PHL and CLT of course along with DCA, LGA, and probably even BOS .... probably still around 25 flights/day I would guesstimate. There would probably still be a lot of folks who would still fly them for business who wouldn't take their departure as personally as the average FT'er.

The talk of other carriers coming in sure seems like nothing more than talk to me. No LCC is going to add a significant number of flights (and jobs) to PIT at the prices US is paying ... and if you're going to make some sweetheart deal, why make it to someone else ... spite is not the beast reason for choosing a particular negotiation tact when you're dealing with the livlihood of at least 8,000 people. Even if you make a sweetheart deal to someone else, there's no way they're bringing in any where near the number of jobs (I doubt they could attract a maintenance facility, I don't think anyone is looking to add one) and flights US already has.

BTW, I don't like to get into "trickledown" too much, but let's just look at jobs at the airport ... I would think there would be a significant reduction in jobs at the airport if US cut its flights by 90%, say 300 flights/day gone. Even if other carriers added capacity, how much capacity you think they're going to add? Best case, I think PIT would have to board up two of its four main concourses ... I can't imagine they're going to need more than the 40-50 gates you have in two concourses ... all the businesses and support folks for those other two concourses ... buh bye.

</font>

I doubt it. If they only had flights to CLT and PHL I would expect Delta to become the #1 carrier here assuming no other carrier does a mini-hub thing. Northwest would be my bet for #2 and USAirways would be #3.

Why would delta or northwest play in pit? They have hubs just a few hundred miles away, CVG and DTW respectively

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pitflyer:
I doubt it. If they only had flights to CLT and PHL I would expect Delta to become the #1 carrier here assuming no other carrier does a mini-hub thing. Northwest would be my bet for #2 and USAirways would be #3.</font>

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by NeoOfTheCRS:
Why would delta or northwest play in pit? They have hubs just a few hundred miles away, CVG and DTW respectively
</font>

Pitflyer is just saying that if PIT became just another spoke (no hub at all) with flights only to hubs (CLT & PHL) that it would be natural for larger carriers to be larger than US. I suspect that part of that argument is that they have hubs that are relatively close by.

hscottm - yes, I do try to venture off that thread...from time to time. http://www.flyertalk.com/forum/smile.gif

I am just hoping this situation is resolved soon....without making me pay for it.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by HPTunco:
Specifically the leases were cancelled with 20 minutes to go before US emerged from BK protection. Not enough time for Allegheny County to react.

Yes, technically the leases were cancelled DURING BK, but the insidious way that it was done can only highlight US's intention to defraud Allegheny County.</font>

What exactly do you think Allegheny County could have done if US had cancelled the leases earlier?

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Beckles:
What exactly do you think Allegheny County could have done if US had cancelled the leases earlier?</font>

Had a six month lead time on finding a solution, and/or another tenant. Felt the love, instead of generating huge amounts of bad faith. The list goes on.

I hope US leaves PIT. I want to see them fly a few hundred more flights/day thru PHL. I really, really do.

------------------
Saving the world, one clue at a time.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by ClueByFour:
Had a six month lead time on finding a solution, and/or another tenant. Felt the love, instead of generating huge amounts of bad faith. The list goes on.

</font>

Allegheny County does have a lead time ... the leases are voided as of January 2004 ... if US had cancelled them earlier the effective date would have been earlier too, Allegheny County didn't lose any time based on when US cancelled the leases, and in fact Allegheny County benefits from US paying the high rates for a longer period of time before the leases are cancelled.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Beckles:
Allegheny County does have a lead time ... the leases are voided as of January 2004 ... if US had cancelled them earlier the effective date would have been earlier too, Allegheny County didn't lose any time based on when US cancelled the leases, and in fact Allegheny County benefits from US paying the high rates for a longer period of time before the leases are cancelled.</font>

As we all know (but isnt said publicly by the county/etc) - the reason the local/state government is mad is not because asking for a better lease is an unrealistic demand but because the local govt types went to bat on US' behalf to all the other govt types while they were in bankruptcy. They felt like 'part of the team' that was keeping US in business, in PA (PIT and PHL).

When US stuck it to them at the last minute, I dont think they saw it coming at all. Kinda like mutiny.

Of course, their surprise is really foolish. They really should have been thinking about 'what if' scenarios.