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America West Is Big Winner of Eastern Slots : Regional Carrier Gets 10 Spaces at 2 Airports

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From Staff and Wire Reports

America West Airlines, a growing regional airline making a push into East Coast markets, was a big winner Monday in a government drawing for airport slots left open because of the Eastern Airlines strike.

The Federal Aviation Administration lottery allocated 86 temporary slots at four of the nation’s busiest airports: Washington National, O’Hare International at Chicago and LaGuardia and John F. Kennedy International, both in New York.

The FAA said Eastern has the right to take back all the slots if it resumes full service.

America West Airlines won temporary rights to take off or land at six slots at National and four at LaGuardia.

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In New York, meanwhile, U.S. Bankruptcy Judge Burton R. Lifland postponed a hearing at which he will consider which of two bidders should be allowed to purchase Eastern’s Northeast shuttle, which has two routes: New York-Washington and New York-Boston.

Eastern had already agreed to sell the shuttle to New York developer Donald J. Trump for $365 million when Phoenix-based America West made a higher offer for the profitable shuttle. Eastern attorney Harvey Miller asked for the postponement so that Eastern could complete its analysis of the America West proposal.

$415 Million Offered

America West offered a package price of $415 million for the shuttle and $336 million for 10 of Eastern’s Boeing 757s. Alternatively, America West would buy only the shuttle’s gates and landing slots at the three airports for $375 million, without the 21 Boeing 727s that would be included in the Trump deal.

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The 727s, which are older than the 757s, have an estimated value of $80 million.

Joel Zweibel, attorney for Eastern’s creditors in the airline’s bankruptcy proceeding, said the America West offer amounts to $94 million more than the Trump offer. The Trump deal has received all necessary regulatory approvals, however, and Trump has said he will withdraw the offer Friday if it is not accepted by then.

Myron Trepper, an attorney for Trump, told reporters: “Mr. Trump is convinced that (America West) can’t raise the money. They’ve been everywhere in New York, pounding the pavement.”

Trump does not intend to extend the Friday deadline on the shuttle contract or to raise his offer, Trepper said.

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America West began passenger service in 1983 and primarily serves the Southwest and California. It also offers a handful of nonstop flights from Phoenix and Las Vegas to New York and Washington.

‘Flights Popular’

“We’ve been looking to get slots at LaGuardia and National for quite some time because our flights to the East Coast are so popular,” America West official Mark Inciong said. He said the airline’s planes to New York and Washington are usually about 75% full. In the airline business, load factors exceeding 50% are considered good.

Another big winner in Monday’s lottery was Majestic/Pacific Interstate, a Miami-based charter airline moving into scheduled service, a Majestic official said. Majestic won six slots at National, six at LaGuardia and two at O’Hare.

DHL Airways of Redwood City, Calif., which delivers documents and packages, won three slots at JFK, and Air Wisconsin won one at O’Hare.

In the FAA lottery, the nation’s largest airlines also expanded their capacities at the four airports.

American Airlines got six slots at National, two at O’Hare, two at LaGuardia and one at JFK; Braniff Airways drew four slots at National and four at LaGuardia; Continental Airlines got three at LaGuardia and two at National; Delta Air Lines drew one at National; Northwest Airlines got four at National and two at LaGuardia; Pan American World Airways won six slots at National, two at LaGuardia and two at JFK; Trans World Airlines obtained three slots at National; United Airlines got six at National and two at LaGuardia, and USAir/Piedmont was allocated four slots at National and two at LaGuardia.

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