USAir's exit strategy from its alliance with British Airways is becoming clearer as it seeks more international routes and announces a massive fleet renewal programme which could prompt renewed interest from other investors.
There is speculation that USAir may seek to build a major transatlantic network by acquiring routes from TWA. TWA retains a wide European network with services from New York to Athens, Barcelona, Frankfurt, Lisbon, Madrid, Milan and Rome, and from Boston to Paris.
Both carriers deny all speculation but there is support for the idea among analysts. 'USAir has launched the TWA tyre many times and there is a lot of strategic benefit,' says Renee Shaker at Moody's. 'I would be more surprised if something didn't happen.'
USAir's international capacity has climbed 47 per cent over the past year with the launch of new services to Munich, Rome and Madrid from Philadelphia. The carrier has already indicated its intention to operate independently to London/Heathrow in competition with BA from Pittsburgh, Philadelphia and Charlotte and says it will cease its codeshare and FFP deal with the UK carrier from 29 March 1997. Analysts believe the alliance generates only around US$12 million a year for USAir.
In November USAir chairman and chief executive Stephen Wolf announced firm orders for 120 aircraft from the Airbus A320 family, plus 160 options and a letter of intent for 120 more. Deliveries are due to start in 1998, replacing the carrier's B737-200s and remaining B727-200s. This followed a doubling of third quarter net profits from $22 million to $45 million.
Doug Cameron
Source: Airline Business
