ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Wednesday, November 13, 1996 TAG: 9611130071
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
DATELINE: NEW YORK
SOURCE: Associated Press
THE AIRLINE, soon to become US Airways, plans to come up with a management style to match its new name.
Saying it was guilty of doing just about everything wrong, USAir said Tuesday it would reinvent itself, starting with a new name: US Airways.
``The company needs fixing. It is very obvious,'' said Rakesh Gangwal, USAir's president and chief operating officer.
Speaking to industry analysts for the first time since Stephen Wolf took over as chairman and chief executive earlier this year, USAir officials announced a wide-ranging overhaul - from a new corporate logo to plans to shave costs.
But they gave few specifics during the four-hour presentation as to how they would fix the problems, sparking a mixed reaction over whether the plans actually would work.
``It would be very hard for them to start the program, then call it off,'' said Philip Baggaley, managing director of corporate ratings for Standard & Poor's, who said the name change is ``a very small part of the whole puzzle.''
To identify and solve problems, the airline has set up 15 task forces, each made up of management, union leadership and rank and file employees. They are looking at ways to improve service and employee morale and cut costs.
Gangwal, noting the airline is made up of six different carriers that merged between 1968 and 1989, said they never have been operationally and culturally integrated.
Jonathan Wooten, who owns about one-half percent of USAir stock, applauded the move, saying it's ``a great marketing move, because USAir has a bad brand image.''
Two USAir ticket agents in Manhattan said they didn't like the new name, noting it sounds, and looks, similar to British Airways.
Among the changes under way or planned:
nThe new name and logo, a stylized version of the national flag, which will be phased in beginning in 1997.
nA new color scheme for planes, airport lounges and boarding passes. The planes will be painted dark blue and medium gray, with red and white accent lines. The interiors of all aircraft will be refurbished.
nA first class on flights to Europe, to be called Envoy Class, with sleeper-type seats and other amenities. First-class cabins on domestic flights will be expanded.
nA redesigned frequent flier program to be called Dividend Miles. It will create a top tier for those who fly more than 100,000 miles a year.
nA new reservation system expected to save $12 million annually; a new computer system to ensure that not too many meals are loaded onto planes should save $4.5 million annually; and a new computer for tracking parts means the shop can do in a minute what used to take nearly an hour.
nA commitment to save nearly $65 million annually by eliminating on-ground damage to aircraft through training, feedback and enforcement.
nA new outsourcing contract to overhaul engines, expected to save $500 million to $725 million over 10 years.
nUSAir won't take delivery of eight Boeing 757s, scheduled for delivery in 1998, but will begin negotiations with Boeing and Airbus for new wide-body aircraft.
nDivulged that the recently announced order for up to 400 new planes from Airbus includes a provision that they will not be delivered unless USAir is cost competitive.
The airline said it will re-evaluate how it can best serve its passengers in the cities where it flies and has identified several cities from Florida to California that it could better serve from the Northeast.
``We are our own largest competitor in the East Coast,'' Gangwal said, noting that USAir has three hubs within a 90-mile radius: Philadelphia, Baltimore and National airport in Washington.
LENGTH: Medium: 76 lines ILLUSTRATION: PHOTO: AP. USAir Chairman Stephen Wolf stands behind a jetby CNBmodel showing the air carrier's new look. color.