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US Airways Shifting Some Winston-Salem Operations to Tempe

Posted on: Friday, 9 September 2005, 21:00 CDT

Sep. 10--US Airways Group Inc. said yesterday that it plans to transfer its revenue-accounting operations from Winston-Salem, eliminating 268 jobs, when its proposed sale to America West Holdings Corp. is completed.

The timing of the transfer has not been set, said David Castelveter, a spokesman for US Airways. He said that it could happen as early as October or take several months.

The local revenue-accounting operations are based in Madison Park in the northwest part of the city.

"The job functions of those departments ultimately will be handled in Tempe when the merger is completed," Castelveter said. America West is based in Tempe, Ariz., which is where a merged company would have its headquarters.

A potential final hearing on US Airways' reorganization plan is scheduled for Thursday in Washington.

If Stephen Mitchell, a U.S. Bankruptcy Court judge, approves the plan, the airline could emerge for the second time from Chapter 11 bankruptcy protection in late September. The merger deal could close the same day as the airline leaves bankruptcy.

Once the two airlines are merged, it would be just a matter of time for converting their revenue-accounting networks to America West's system, Castelveter said.

Local revenue-accounting employees said yesterday that they were told by US Airways in an Aug. 26 memo that the operations could be shut down because of the merger.

The conversion is part of a plan to combine two struggling carriers with little territorial overlap to form a stronger airline. The goal is to become a low-fare carrier that can compete better with Southwest Airlines Inc. and JetBlue Airways Corp.

The job cuts would shrink US Airways' work force of 1,122 in the Triad by nearly 25 percent. About 591 employees remain at the airline's reservations center off Hanes Mall Boulevard. The work force at the reservations and Dividend Miles centers was 1,600 as recently as August 2004.

Piedmont Airlines, which was started in Winston-Salem and which US Airways bought in November 1987, had about 5,600 employees in the Triad at its peak.

Most of the US Airways jobs at Madison Park are non-union administrative and clerical positions, along with some management jobs, Castelveter said.

US Airways officials said that local employees would have the opportunity to transfer to Tempe, but non-management personnel would have to pay their own moving expenses.

"We will give existing employees who want to make the move first shot at the jobs that will be created in the consolidated facility," said Phil Gee, a spokesman for America West.

Some local employees, who declined to be identified for fear of losing their jobs, said they felt airline officials tried to discourage them from considering a transfer. They said they were told the cost of living was much higher in Tempe, and it was likely that their pay would be cut if they accepted a transfer.

The employees said they are being offered 15 weeks of severance pay and one year of flying privileges. Castelveter said he could not confirm the offer.

There is a strong likelihood that the airlines will merge shortly, said Keith Debbage, an aviation analyst and a geography professor at the University of North Carolina at Greensboro.

"There is some serious momentum behind this merger, but whether it ultimately saves the airlines remains to be seen," Debbage said.

"What the Triad should be concerned about is whether this consolidation of the revenue department is a foreshadowing of other consolidation moves that favor America West facilities and personnel over US Airways'.

"I am hopeful that the corporate heritage of Piedmont Airlines will play a role in the Triad's favor for keeping a sizable work force here," he said. "But the new airline will do what is best for its bottom line."

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Source: Winston-Salem Journal

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