From the USAirways website:
"On September 12, 2004, US Airways Group announced that the Company and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The action is intended to provide the airline the opportunity to implement its Transformation Plan built on lower costs, a simplified fare structure, and expanded service in the eastern U.S., Europe, the Caribbean and Latin America. The case will be heard in the U.S. Bankruptcy Court for the Eastern District of Virginia in Alexandria, Virginia.

Customers should notice no changes to flight operations or customer service programs because of the filing. All bookings will be honored, and ticketing policies are unchanged. Existing marketing partnerships with other airlines remain in place. Employees will be paid and their benefits will continue. Vendors will be paid in ordinary course for provided goods and services going forward. In the future, if there are any changes to schedules or policies, they will be announced in advance.

US Airways has also received permission from the Court to allow the company to honor all key agreements related to its Dividend Miles program and the co-branded Bank of America/Dividend Miles credit card.

Despite the tremendous strides made by US Airways to transform the airline since its emergence from Chapter 11 in March 2003, and the reduction of nearly $2 billion in annual operating expenses, dramatic changes taking place in the industry require the company to do even more to achieve a competitive cost structure. These changes include the rapid growth of low-cost carriers, unprecedented fuel cost increases and consumer demand for lower, simpler fares. As the restructuring proceeds, US Airways will be taking the necessary steps to transition itself into a successful low-cost airline."

Seems as if our FF miles may be safe for a while.

whats your definition of "for a while"?

I have no idea, kuranosuke. There were people on the board that thought their miles might disappear this weekend. It usually takes months and months for the judicial process to play out, so those of us planning trips in the spring using FF miles just may have a chance.

<b>Betsy</b>,

I hope that USAir does make it and everything works out for you but to base your optimistic outlook on an official press release from the company that's actually bankrupt?

There are many more &quot;NOT&quot; so optimistic aricles in major business newspapers today, not giving USAir much of a chance of survivial in a very short term. Many transportation experts see them fold before end of the year and if not, cut most of their international and small US town routes.

It's true that if they continue to fly, your miles &quot;should&quot; be good, although in T&amp;C of all freuent flyer programs it is stated that the airline has the right to pull the program at any time without any future liability. I don't think that will happen, but getting back to the subject, if they liquidate next week or next month, it will NOT take months for everything to be sorted out. Under Chapter 7, it's over with one press release.

I don't know how old you are, but I remember Braniff and a giant Eastern Airlines. It was quick and deadly.

If they are able to run under Chapter 11, you should be fine, unfortunately their credit rating issued by Standard and Poor's went into default yesterday. That meas no commercial lender will borrow USAir any money. The only hope they have is concessions and/OR private/institutionalized investors. Many times these investore are like vultures. Basically they pay pennies on a dollar for assets which they quickly sell off and thus close the company.

Hope my bleak assestmnets won't come to be true. I'm really pulling for USAir, but I'm also realistic.

So if US Airways stops flying, what happens to all of us with pending air travel plans with them?

We have flights booked in January (with US Airways (east coast to San Francisco) and United (from San Francisco to Maui) - the flight was reserved through US Airways. I'm a bit nervous ... and it's too late to cancel my reservations.

United has been operating-business as usual for almost 2 years IN BANKRUPTCY so I wouldn't panic yet. If United can operate for 2 years in bankruptcy can't US Air?
If Delta, US Air, United etc all went down at the same time it would be bad. No one has the capital to buy defunct airlines planes and routes so many areas of country would be grounded. Why can't someone figure out this whole airline industry???

AA Frequent Flyer:
I am flying to Nassau in early Oct. on US Air. Two paid for and two freebies. Since the announcement, what is your thoughts on the company and flying in the near future.

Early Oct, no problem. Jan, it's iffy.

The current situation of USAirways is much more dire than UA or DL. Many companies file for Chapter 11, but most of them go in already with a masterplan worked out, and they go in to &quot;reorganize&quot; - getting new financing, reducing debt. This time, USAirways goes in with none of those, and has no collaterals they can use. Debtors (like the leasing companies that own the planes) will likely say USAirways is not worth saving anymore.

And USAirways have stuck into this weak position for many many years. Quite different from UA and DL which has lucrative Pacific and Atlantic operations, respectively.

BTW, someone did figure out this industry. Southwest have been profitable for many years, even during downturns. Ryanair of Ireland is one of most &quot;worthy&quot; airlines in the world, if you look at their stocks. And no one says only LCC can do well. Cathay Pacific and Singapore Airlines have been highly profitable for many years (except for SARS in 2003)by providing outstanding service.

There was a detailed article in the Wall Street Journal today about US Air. To sum it up, your probably safe until some time after the presidential election in November, but don't expect the airline to last very long after that. If you have FF miles, try to get a flight soon or on a partner airline because if the airline is broken up, its not likely anyone will assume their FF miles.

It's kind of an apples and oranges comparison, isn't it rkkwan, to compare UA with Singapore Airlines and Cathay Pacific. Those two Asian airlines are not competing in the US domestic market. In their market, UA operates &quot;lucratively&quot; by supplying a lower priced product. In the supply/demand equation it sounds like the suppliers have the edge, for now.

Well, I wasn't comparing SQ/CX with the US domestic market. One can't. I'm just responding to the comment that no one has figured out the airline industry. All I'm saying is that SW has been profitable in the US for years, so has SQ/CX internationally.

I guess a better question is whether a US-based airline with good management and an extensive network both in the US and internationally, can make it work. Well, UA isn't, as its cost is still higher than all the LCC plus CO and AA. And it has very limited network in Central and South America, while its European routes aren't that strong either.

DL with only a European network and good market in the East Coast isn't doing well either, particularly because of its costs.

AA and CO has limited routes in Asia (except AA to NRT &amp; CO at Guam/Saipan), but they have the lowest cost of the majors. Both have good domestic networks with strong hubs at big cities. AA has strong presence in Latin America, CO has strong presence to Mexico. AA's strong to the UK (the biggest market for Americans traveling to Europe), and CO's expanding its European network to many secondary cities.

So, both of those are in relatively good shape, earning a little in the summer, and at least not bleeding too bad in the winter. So, they've <b>somewhat</b> figured out the system too.