For the second time in less than two years, US Airways Group announced on Sunday it had filed for bankruptcy protection after failing to resolve a dispute over wages and benefits with its key unions.
”Since we still lack the new labour agreements that are needed for the transformation plan to succeed, we must preserve the company’s cash resources that are required to implement the plan,” US Airways chief executive Bruce Lakefield said in a statement.
”We have made the difficult but necessary decision to complete this process with the help of the court,” he pointed out.
The carrier is seeking $800-million in pay cuts from its five unions.
But in-fighting between pilot union leaders at US Airways broke out last week, spoiling a possible cost-cutting package seen as the first step to bringing the other unions on board.
The union are to resume talks this coming week, but there was no certainty of a breakthrough.
Lack of labour progress at US Airways prompted Standard and Poor’s this week to downgrade the airline’s corporate credit rating for the fourth time this year.
The seventh-largest US airline said customers should notice no changes to flight operations or customer service programmes because of the filing.
It said it intended to ask the bankruptcy court to allow it to continue its key incentives and financial programmes.
US Airways also vowed to continue to pay its employees and vendors and to provide employee benefits as before. – Sapa-AFP