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Break in the Clouds for United and US Airways

In the last issue of News & Views, Logistics Today reported talks between US Airways and its pilots had broken down when the two sides failed to reach a consensual agreement on needed cost cuts. The airline reported last week that those talks had resumed.

The union representing pilots submitted a proposal on August 28th and the airline countered the following day. Neither side indicated the nature or details of the proposals. The airline had been seeking $295 million in cost costs from the pilots out of a total $800 million it hoped to gain from labor. It is attempting to obtain concessions from its other labor unions. The labor cost concessions constitute just over half of the $1.5 billion in expenses the airline says it must cut.

Meanwhile at United Airlines, the carrier said it would start bringing back flight attendants as a result of an increase in aircraft hours resulting from more international flying and higher aircraft utilization. That appears to be good news for the struggling carrier. It made headlines this summer when the airline skipped a $72.4 million pension fund payment and announced it would suspend payments while under Chapter 11 bankruptcy protection. That move sparked a flurry of activity, which resulted in a Dept. of Labor review and a statement that an independent fiduciary would be appointed to represent the interests of participants and beneficiaries of the pension plan.

Further good news for the carrier – the U.S. Dept. of Transportation granted authority for United to begin Saturday service to Cancun and granted authority to its subsidiary Ted to begin operating daily flights to Puerto Vallarta.

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