American chief: Airline ambivalent about US Airways deal
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ARLINGTON, Va. (AP) - Executives of Texas-based American Airlines are having second thoughts about joining United Airlines in a proposed purchase of US Airways.

American chairman and chief executive Donald Carty said the airline is ``ambivalent'' about the deal because of significant financial losses in the airline industry, USA Today reported in Thursday's edition.

``The acquisition of US Airways or any assets of US Airways involves more capital,'' Carty said in a meeting with the newspaper's editors and reporters, ``and therefore we have some ambivalence about spending capital in this kind of environment.''

AMR Corp., American's parent, purchased TWA in April. It also owns American Eagle. On Tuesday, AMR said it expected a second-quarter loss of more than $100 million and blamed that on the weak economy, which has depressed demand for business travel. American is the world's largest carrier.

In January, Fort Worth, Texas-based American said it would buy certain US Airways assets for $1.2 billion in cash from United, making it the largest airline merger ever. United initially wanted to merge with US Airways by itself, but included American in the deal in hopes of avoiding scrutiny by the Justice Department for violating antitrust laws.

Carty said American was surprised to learn that United hadn't gotten any confirmation from federal regulators that including American in the deal would quell their antitrust concerns.

He also said any of the airlines involved could back out of the deal by Aug. 1 and avoid large fines. Then the deal could be reworked or discontinued, Carty said.

United declined to comment on the substance of Carty's remarks. Airline spokesman Andy Plews said United ``continues to push for approval of the transaction.''

Carty said the airlines haven't yet discussed any changes to the deal.