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Problems, cancellations on rise at US Airways

The troubled airline canceled an average of 169 flights a day in July. Several causes lead one pilot to say, "This place is a disaster."

Gary DeShazer, regional sales manager for a roofing manufacturing firm, flies nearly every week on US Airways and has never had such a hard time of it.

Of the four trips DeShazer made in July, three were disrupted by canceled flights. On July 29, his afternoon flight home from to Charlotte, N.C., from Huntsville, Ala., was canceled. Then the evening flight was canceled.

"People wanted to climb over the ticket counter to get at the gate agents," DeShazer said. "And they said, "We're sorry _ something is wrong with our company and we can't do anything about it.' "

Something is definitely wrong at US Airways, where a little more than a year ago chairman Stephen Wolf and president and chief executive Rakesh Gangwal were being widely applauded for their genius in turning around the once-troubled airline. US Airways is the largest carrier at Tampa International Airport.

Today, its operations are in disarray. One indication: In July, the airline canceled 7.6 percent of its scheduled departures _ an average of 169 a day. By contrast, American's July cancellation rate was 2.5 percent, while United's was 3.5 percent. Last July, US Airways canceled 1.8 percent of its flights.

July's cancellations had several causes. They include delays in moving planes out of the Charlotte maintenance base, problems in crew scheduling as thousands of employees train on new Airbus jets, air-traffic control system inefficiencies, bad weather, a shortage of dispatchers and continuing adjustments to the new Sabre computer system.

US Airways officials acknowledged air traffic and weather delays but declined to comment further. However, in a report filed Friday with the Securities and Exchange Commission, the airline said pilot training, maintenance delays and the Sabre introduction have caused and will continue to cause cancellations.

"Passenger dissatisfaction resulting from this circumstance is also anticipated to have a continuing negative impact," the airline said in the report. It noted that cancellations cut revenues but not expenses. The airline's problems result, in part, from Wolf's efforts to cut costs, which remain higher at US Airways than at any other major airline. Wolf has said often that fixing problems caused by the inefficient merger of six airlines into USAir, now US Airways, is a long-term job.

Thus, the airline closed maintenance bases in Greensboro, N.C., and Winston-Salem, N.C., because it had operated six maintenance bases, while larger airlines such as United operate two.

Training will enable US Airways to operate a fleet of modern jets, which will eventually cost less than operating a hodgepodge fleet of seven aircraft types. And the move to Sabre in November provided US Airways with a modern, efficient computer system that won't suffer glitches when 2000 arrives.

But for the short term, "This place is a disaster," a pilot said. "Sometimes I have to ask if Schofield is back."

Seth Schofield headed the airline from 1991 until Wolf replaced him in 1996. During Schofield's tenure, the airline lost $2.5-billion.

Wolf, taking advantage of an improved economic climate for airlines, moved quickly to turn things around. The stock rose from $15 a share when he was hired to $83 in July 1998, and the airline reported record profits of $1-billion in 1997.

But now, the trends are down. US Airways shares fell $2.31\, or 7 percent, to $32.43} Friday. Twice this summer, the airline has warned investors to lower profit expectations for the rest of 1999. The bond rating company Standard & Poor's has downgraded its outlook on some US Airways securities.

This week, major shareholder Tiger Management said it is exploring ways to enhance the airline's shareholder value, possibly through a sale or merger. Experts say the filing was an effort to shake the stock out of its doldrums.

Some Wall Street analysts attribute the airline's poor results to problems at MetroJet, the low-fare division that began flying in 1998 as low-fare carriers such as Southwest moved into US Airways' turf. US Airways said in May it would slow MetroJet growth because of a shortage of planes and pilots.

US Airways won concessions from pilots to operate MetroJet as a low-cost division. So far, flight attendants and mechanics _ both groups are in protracted contract talks _ have not made similar concessions.

The operational problems are visible to all _ most clearly in the half-dozen or more airplanes that routinely sit outside the Charlotte hangar. They can't fly without scheduled maintenance.

In addition, the pilot work force is in flux. Hundreds of pilots are constantly in training courses of six weeks to two months, preparing to move to other Boeing aircraft, as Boeing pilots move to the Airbus. The training bottleneck is expected to last well into 2000.

Flight attendants are also stretched thin: Their schedule limitations led to some of the 300 cancellations July 31.