USAir to Fly, Possibly Buy, Trump Shuttle

USAir reached a preliminary deal Thursday to fly and possibly purchase the Trump Shuttle after American Airlines withdrew its bid to run the commuter carrier.

The deal represents a further consolidation of the air travel industry. It also symbolizes the decline of Donald J. Trump’s empire.

USAir said it will re-name the airline, which caters to Northeastern business travelers, “USAir Shuttle.”

USAir is negotiating with Trump and his bankers on an arrangement to let it fly the shuttle for up to 10 years, giving the carrier a stronger presence in the Northeast corridor. The shuttle offers frequent nonstop service between New York, Boston and Washington.

USAir, based in Arlington, Va., would get an option to buy the shuttle after five years.

“We expect that a definitive management agreement will be reached shortly after the first of the year,” said Seth E. Schofield, USAir’s president and chief executive. The deal must be approved by Trump Shuttle creditors.

USAir declined to provide specifics on the deal. Trump Shuttle and Citibank, which represents the shuttle’s creditors, did not immediately return phone calls.

As Trump’s business has fallen on hard times, he stopped making interest payments on the shuttle, which he bought from now-defunct Eastern Airlines for $360 million in 1989.

As Trump’s debts mounted, bankers have been seeking someone else to take over the shuttle.

After American pulled out, USAir was apparently the only candidate left.

Northwest Airlines came close to flying the shuttle last summer. The arrangement fell apart when Northwest and Trump’s bankers could not come to terms.

American said it broke off talks about running the shuttle because it could not reach an agreement with its pilots’ union over who would fly the planes.

American wanted to manage the shuttle with its workers and work rules intact. But the unionized American pilots had insisted on flying the shuttle planes, making the deal less financially attractive to American, according to a source who requested anonymity.