USAir planning 3,585 additional layoffs Troubled airline takes new cost-cutting step

February 12, 1991|By Maria Mallory

Taking the next step in a major restructuring plan begun in January, USAir said yesterday it will lay off an additional 3,585 workers, including 660 pilots, in its battle to slash expenses.

The latest round of layoffs is the result of the closing of a maintenance facility in Utica, N.Y., a reservations operation in Reston, Va., and four "flight crew bases" -- locations from which USAir pilots and flight attendants are assigned to flights.

In August, 3,600 USAir employees were released.

The latest moves are part of the company's Jan. 25 announcement of restructuring operations. By consolidating services and cutting back expenses, the company hopes to strengthen its ability to weather the airline industry's severe downturn.

"USAir is being restructured to survive this difficult period and to be in a position to rebuild when conditions change," USAir President Seth E. Scholfield said in a statement released yesterday.

USAir spokeswoman Patricia A. Goldman estimates the company could save nearly $10 million annually by shutting down the Utica and Reston operations.

The Arlington, Va.-based airline's latest moves come as no surprise, said Karen Firestone, who tracks USAir's performance for Fidelity Investments in Boston.

"When you are losing $11 a share, I think you've got to take pretty dramatic action; otherwise you may not be around for the good times," she said.

The layoffs will be felt mostly along the East Coast, where USAir has most of its routes. The furloughing affects more than 660 pilots, 540 flight attendants, 505 agents, 305 reservations agents, 1,300 customer-service personnel, 275 managers and other staff members who will be furloughed as a result of the closings of the crew bases in Miami, Greensboro, N.C., Syracuse, N.Y., and San Diego, the airline said.

As part of its efforts to trim operations to better reflect demand, USAir said, it is reducing its daily departures to 2,626 from 2,894.

Last year, 3,004,324 passengers flew on USAir flights from Baltimore-Washington International Airport, about 756,000 fewer than in 1989.

Daily departures of USAir jets from BWI will be whittled to 126 flights from 151 by May 2, the company announced last month.

It is unclear how the new cutbacks will affect the 3,150 USAir employees who work at the company's BWI operation.

Ms. Goldman said furloughed employees at other USAir locations might be eligible for relocation and might have "bumping rights" that could allow them to claim the jobs of BWI employees with less seniority.

USAir has five hubs. Ms. Goldman said Baltimore will continue to be an important hub for the carrier, but it is the only hub where USAir flights are being reduced.

Ms. Goldman said there might be new destinations available from BWI in May under new schedules.

USAir's other hubs include Charlotte, N.C., Pittsburgh and Philadelphia -- which rank in that order as USAir's top three departure points.

Flights are actually being increased by 10 to 19 a day as part of the restructuring. The carrier's fifth hub, Dayton, Ohio, will not be altered significantly.

The airline's parent company, USAir Group Inc., reported a loss in the fourth-quarter of 1990 loss of $221 million, which reflects the damage caused by the recession, high fuel prices and the fear of terrorism.

To defend its market share in some cities, USAir has been compelled to meet profit-crimping fare cuts initiated by competitors. Last week, the carrier met half-price fares to Los Vegas and Phoenix begun by America West.

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