ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Friday, January 17, 1997 TAG: 9701170073
SECTION: BUSINESS PAGE: A-6 EDITION: METRO
DATELINE: WASHINGTON
SOURCE: The Washington Post
Airbus Industrie said Thursday it has informed USAir that it can no longer guarantee specific delivery times for the first of up to 400 new A320 jet aircraft because the Arlington, Va.-based carrier hasn't signed a firm contract.
The USAir order, intended to replace the company's hodgepodge of narrow-body aircraft, was contingent on the airline's ability to cut its costs sufficiently to compete in an increasingly competitive East Coast market. While the airline has slashed costs in many areas, it so far has failed to reach cost-cutting labor agreements.
USAir revealed the Airbus decision to employees on Wednesday on a recorded hot line. Airline spokesmen declined to elaborate further Thursday.
David Venz, a spokesman for Airbus, said Thursday that with world aviation experiencing an upturn in traffic, demand for the A320 is rising. The 51 delivery ``slots'' for USAir in 1997 and 1998 soon may be needed to feed this new demand, he said.
USAir now has only a memorandum of understanding with Airbus for the slots, but has delayed signing a final contract pending the outcome of discussions with the Air Line Pilots Association and other unions.
Venz said the slots still will be open for an undetermined period, but Airbus must be able to promise them to other airlines that are ready to buy.
In practical terms, the Airbus decision means little to USAir. A delivery delay of a few months will do no harm to USAir's modernization plans.
The decision could affect the airline's negotiations with its pilots, now reaching a critical stage. USAir last week suggested to its pilots that they take a pay cut of about 12.5 percent but make up for it by increasing monthly flying time.
LENGTH: Short : 42 linesby CNB