US Airways delays RJ deliveries

Aviation International News » September 2004
March 22, 2007, 7:10 AM

Bombardier has agreed to extend the delivery schedule of US Airways’ regional jets by a year and convert an order for twenty-three 50-seat CRJ200s to positions on 70-seat CRJ700s, now scheduled to enter service with wholly owned subsidiary PSA Airlines through March 2006.

PSA pilot representatives agreed to a scope-clause change to allow for more 70-seaters at the airline in exchange for an extension of the so-called Jets for Jobs protocol to extend to PSA’s CRJ700s. As with the airline’s 50-seat jets, PSA must now staff half of all 70-seat RJ positions with furloughed mainline pilots.

US Airways still hopes to convert some of its delivery slots for the balance of 37 firm-ordered CRJ200s and 48 CRJ700s to positions on 86-seat CRJ900s but cannot do so until its pilot union approves yet another scope-clause change. Last month Bombardier sent US Airways its 30th CRJ, but the Canadian manufacturer now plans to deliver only four more CRJ700s to the airline as it struggles to meet financing conditions set by GE Capital Aviation Services (GECAS).

Meanwhile, US Airways has until September 30 to secure still more employee concessions to meet covenant requirements associated with its $900 million loan guarantee from the ATSB and to preserve its financing deal with GE Capital Aviation Services for RJ deliveries from both Bombardier and Embraer. In May, after US Airways’ Standard & Poor’s credit rating dropped from a B- to a C+++, GECAS threatened to pull the leases if the airline’s pilots did not allow the transfer of regional jets to independent affiliates in the event the parent company couldn’t meet certain financial thresholds. The pilots acquiesced, but US Airways now appears unlikely to meet GECAS’ conditions unless the pilots accept more pay cuts.

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