##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended June 30, 2010
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from  to
 US Airways Group, Inc.
    
 US Airways, Inc.
    
 
 
 Yes þ No o
 Yes o No o
  US Airways Group, Inc.
    
    Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company oUS Airways, Inc.
    
    Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o
  US Airways Group, Inc.
    
    Yes
    
    o
    
    No
    
    þUS Airways, Inc.
    
    Yes
    
    o
    
    No
    
    þ
  US Airways Group, Inc.
    
    Yes
    
    þ
    
    No
    
    oUS Airways, Inc.
    
    Yes
    
    þ
    
    No
    
    o




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##### 



US Airways Group, Inc.
US Airways, Inc.
Form 10-Q
Quarterly Period Ended June 30, 2010
Table of Contents
 PagePart I. Financial InformationItem 1A. Condensed Consolidated Financial Statements of US Airways Group, Inc.Condensed Consolidated Statements of Operations
    
    
    5Condensed Consolidated Balance Sheets
    
    
    6Condensed Consolidated Statements of Cash Flows
    
    
    7Notes to the Condensed Consolidated Financial Statements
    
    
    8Item 1B. Condensed Consolidated Financial Statements of US Airways, Inc.Condensed Consolidated Statements of Operations
    
    
    15Condensed Consolidated Balance Sheets
    
    
    16Condensed Consolidated Statements of Cash Flows
    
    
    17Notes to the Condensed Consolidated Financial Statements
    
    
    18Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    24Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    52Item 4. Controls and Procedures
    
    
    53Part II. Other InformationItem 1. Legal Proceedings
    
    
    54Item 1A. Risk Factors
    
    
    54Item 5. Exhibits
    
    
    64SignaturesExhibit 10.1Exhibit 31.1Exhibit 31.2Exhibit 31.3Exhibit 31.4Exhibit 32.1Exhibit 32.2
   2




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Note Concerning Forward-Looking Statements
  
    
    the impact of significant operating losses in the future;
 
    
    downturns in economic conditions and their impact on passenger demand and related revenues;
 
    
    increased costs of financing, a reduction in the availability of financing and fluctuations
in interest rates;
 
    
    the impact of the price and availability of fuel and significant disruptions in the supply
of aircraft fuel;
 
    
    our high level of fixed obligations and our ability to fund general corporate requirements,
obtain additional financing and respond to competitive developments;
 
    
    any failure to comply with the liquidity covenants contained in our financing
arrangements;
 
    
    provisions in our credit card processing and other commercial agreements that
may affect our liquidity;
 
    
    the impact of union disputes, employee strikes and other labor-related disruptions;
 
    
    our inability to maintain labor costs at competitive levels;
 
    
    our reliance on third-party regional operators or third-party service providers;
 
    
    our reliance on automated systems and the impact of any failure or disruption of these
systems;
 
    
    the impact of changes to our business model;
 
    
    competitive practices in the industry, including the impact of industry consolidation;
 
    
    the loss of key personnel or our ability to attract and retain qualified personnel;
 
    
    the impact of conflicts overseas or terrorist attacks, and the impact of ongoing security
concerns;
 
    
    changes in government legislation and regulation;
 
    
    our ability to operate and grow our route network;
 
    
    the impact of environmental laws and regulations;
 
    
    costs of ongoing data security compliance requirements and the impact of any data security
breach;
 
    
    interruptions or disruptions in service at one or more of our hub airports;
 
    
    the impact of any accident involving our aircraft or the aircraft of our regional
operators;
  3




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##### Table of Contents




    
    delays in scheduled aircraft deliveries or other loss of anticipated fleet capacity;
 
    
    the impact of weather conditions and seasonality of airline travel;
 
    
    the impact of possible future increases in insurance costs and disruptions to insurance
markets;
 
    
    the impact of global events that affect travel behavior, such as an outbreak of
a contagious disease;
 
    
    the impact of foreign currency exchange rate fluctuations;
 
    
    our ability to use NOLs and certain other tax attributes; and
 
    
    other risks and uncertainties listed from time to time in our reports to and filings with
the Securities and Exchange Commission.
  
 Part I. Financial Information
   4




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##### Table of Contents



Item 1A. Condensed Consolidated Financial Statements of US Airways Group, Inc.
 US Airways Group, Inc.
 
 Condensed Consolidated Statements of Operations
 (In millions, except share and per share amounts)
 (Unaudited)
 Three Months
    
    
    Six MonthsEnded June 30,
    
    
    Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Operating revenues:Mainline passenger
    
    $
    2,036
    
    
    $
    1,724
    
    
    $
    3,735
    
    
    $
    3,335Express passenger
    
    
    767
    
    
    
    642
    
    
    
    1,368
    
    
    
    1,194Cargo
    
    
    37
    
    
    
    20
    
    
    
    69
    
    
    
    44Other
    
    
    331
    
    
    
    272
    
    
    
    649
    
    
    
    540Total operating revenues
    
    
    3,171
    
    
    
    2,658
    
    
    
    5,821
    
    
    
    5,113Operating expenses:Aircraft fuel and related taxes
    
    
    616
    
    
    
    440
    
    
    
    1,151
    
    
    
    819Loss (gain) on fuel hedging instruments, net
    
    
    
    
    
    
    (21
    )
    
    
    
    
    
    
    5Salaries and related costs
    
    
    573
    
    
    
    549
    
    
    
    1,128
    
    
    
    1,100Express expenses
    
    
    683
    
    
    
    625
    
    
    
    1,333
    
    
    
    1,228Aircraft rent
    
    
    169
    
    
    
    174
    
    
    
    340
    
    
    
    352Aircraft maintenance
    
    
    162
    
    
    
    184
    
    
    
    319
    
    
    
    358Other rent and landing fees
    
    
    135
    
    
    
    142
    
    
    
    270
    
    
    
    273Selling expenses
    
    
    107
    
    
    
    99
    
    
    
    201
    
    
    
    192Special items, net
    
    
    (9
    )
    
    
    1
    
    
    
    (4
    )
    
    
    7Depreciation and amortization
    
    
    63
    
    
    
    62
    
    
    
    124
    
    
    
    121Other
    
    
    301
    
    
    
    281
    
    
    
    598
    
    
    
    561Total operating expenses
    
    
    2,800
    
    
    
    2,536
    
    
    
    5,460
    
    
    
    5,016Operating income
    
    
    371
    
    
    
    122
    
    
    
    361
    
    
    
    97Nonoperating income (expense):Interest income
    
    
    3
    
    
    
    6
    
    
    
    9
    
    
    
    13Interest expense, net
    
    
    (86
    )
    
    
    (77
    )
    
    
    (168
    )
    
    
    (148
    )Other, net
    
    
    (9
    )
    
    
    7
    
    
    
    33
    
    
    
    (7
    )Total nonoperating expense, net
    
    
    (92
    )
    
    
    (64
    )
    
    
    (126
    )
    
    
    (142
    )Income (loss) before income taxes
    
    
    279
    
    
    
    58
    
    
    
    235
    
    
    
    (45
    )Income tax provision
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss)
    
    $
    279
    
    
    $
    58
    
    
    $
    235
    
    
    $
    (45
    )Earnings (loss) per common share:Basic earnings (loss) per common share
    
    $
    1.73
    
    
    $
    0.47
    
    
    $
    1.46
    
    
    $
    (0.38
    )Diluted earnings (loss) per common share
    
    $
    1.41
    
    
    $
    0.42
    
    
    $
    1.23
    
    
    $
    (0.38
    )Shares used for computation (in thousands):Basic
    
    
    161,292
    
    
    
    123,790
    
    
    
    161,204
    
    
    
    118,956Diluted
    
    
    203,809
    
    
    
    144,125
    
    
    
    200,404
    
    
    
    118,956
   5




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##### Table of Contents



US Airways Group, Inc.
 
 Condensed Consolidated Balance Sheets
 (In millions, except share and per share amounts)
 (Unaudited)
 June 30,
    
    
    December 31,2010
    
    
    2009ASSETSCurrent assetsCash and cash equivalents
    
    $
    1,814
    
    
    $
    1,299Investments in marketable securities
    
    
    180
    
    
    
    Accounts receivable, net
    
    
    394
    
    
    
    285Materials and supplies, net
    
    
    226
    
    
    
    227Prepaid expenses and other
    
    
    500
    
    
    
    520Total current assets
    
    
    3,114
    
    
    
    2,331Property and equipmentFlight equipment
    
    
    4,104
    
    
    
    3,852Ground property and equipment
    
    
    876
    
    
    
    883Less accumulated depreciation and amortization
    
    
    (1,254
    )
    
    
    (1,151
    )3,726
    
    
    
    3,584Equipment purchase deposits
    
    
    63
    
    
    
    112Total property and equipment
    
    
    3,789
    
    
    
    3,696Other assetsOther intangibles, net of accumulated amortization of $126 million and $113 million, respectively
    
    
    490
    
    
    
    503Restricted cash
    
    
    442
    
    
    
    480Investments in marketable securities
    
    
    59
    
    
    
    203Other assets
    
    
    237
    
    
    
    241Total other assets
    
    
    1,228
    
    
    
    1,427Total assets
    
    $
    8,131
    
    
    $
    7,454LIABILITIES & STOCKHOLDERS DEFICITCurrent liabilitiesCurrent maturities of debt and capital leases
    
    $
    475
    
    
    $
    502Accounts payable
    
    
    370
    
    
    
    337Air traffic liability
    
    
    1,215
    
    
    
    778Accrued compensation and vacation
    
    
    212
    
    
    
    178Accrued taxes
    
    
    211
    
    
    
    141Other accrued expenses
    
    
    851
    
    
    
    853Total current liabilities
    
    
    3,334
    
    
    
    2,789Noncurrent liabilities and deferred creditsLong-term debt and capital leases, net of current maturities
    
    
    4,061
    
    
    
    4,024Deferred gains and credits, net
    
    
    344
    
    
    
    377Postretirement benefits other than pensions
    
    
    129
    
    
    
    130Employee benefit liabilities and other
    
    
    431
    
    
    
    489Total noncurrent liabilities and deferred credits
    
    
    4,965
    
    
    
    5,020Commitments and contingenciesStockholders deficitCommon stock, $0.01 par value; 400,000,000 shares authorized, 161,791,870 and 161,374,246 shares
issued and outstanding at June 30, 2010; 161,520,457 and 161,102,833 shares issued and
outstanding at December 31, 2009
    
    
    2
    
    
    
    2Additional paid-in capital
    
    
    2,114
    
    
    
    2,107Accumulated other comprehensive income
    
    
    35
    
    
    
    90Accumulated deficit
    
    
    (2,306
    )
    
    
    (2,541
    )Treasury stock, common stock, 417,624 shares at June 30, 2010 and December 31, 2009
    
    
    (13
    )
    
    
    (13
    )Total stockholders deficit
    
    
    (168
    )
    
    
    (355
    )Total liabilities and stockholders deficit
    
    $
    8,131
    
    
    $
    7,454
   6




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##### Table of Contents



US Airways Group, Inc.
 
 Condensed Consolidated Statements of Cash Flows
 (In millions)
 (Unaudited)
 Six Months Ended June 30,2010
    
    
    2009Net cash provided by operating activities
    
    $
    739
    
    
    $
    360Cash flows from investing activities:Purchases of property and equipment
    
    
    (94
    )
    
    
    (621
    )Purchases of marketable securities
    
    
    (180
    )
    
    
    Sales of marketable securities
    
    
    143
    
    
    
    20Decrease in long-term restricted cash
    
    
    38
    
    
    
    6Proceeds from sale-leaseback transactions and dispositions of property and equipment
    
    
    2
    
    
    
    52Net cash used in investing activities
    
    
    (91
    )
    
    
    (543
    )Cash flows from financing activities:Repayments of debt and capital lease obligations
    
    
    (220
    )
    
    
    (175
    )Proceeds from issuance of debt
    
    
    90
    
    
    
    749Deferred financing costs
    
    
    (3
    )
    
    
    (8
    )Proceeds from issuance of common stock, net
    
    
    
    
    
    
    66Net cash provided by (used in) financing activities
    
    
    (133
    )
    
    
    632Net increase in cash and cash equivalents
    
    
    515
    
    
    
    449Cash and cash equivalents at beginning of period
    
    
    1,299
    
    
    
    1,034Cash and cash equivalents at end of period
    
    $
    1,814
    
    
    $
    1,483Non-cash investing and financing activities:Note payables issued for aircraft purchases
    
    $
    111
    
    
    $
    32Interest payable converted to debt
    
    
    22
    
    
    
    19Net unrealized loss (gain) on available-for-sale securities
    
    
    1
    
    
    
    (34
    )Deposit applied to principal repayment on debt
    
    
    (19
    )
    
    
    Maintenance payable converted to debt
    
    
    
    
    
    
    10Supplemental information:Interest paid, net of amounts capitalized
    
    $
    111
    
    
    $
    100Income taxes paid
    
    
    
    
    
    
    
   7




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##### Table of Contents



US Airways Group, Inc.
 
 Notes to Condensed Consolidated Financial Statements
 (Unaudited)
 1. Basis of Presentation
   Recent Accounting Pronouncements
    8




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##### Table of Contents



2. Special Items, Net
  Three Months
    
    
    Six MonthsEnded June 30,
    
    
    Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Aviation Security Infrastructure Fee (ASIF) refund (a)
    
    $
    (16
    )
    
    $
    
    
    
    $
    (16
    )
    
    $
    Other costs (b)
    
    
    7
    
    
    
    
    
    
    
    7
    
    
    
    Aircraft costs (c)
    
    
    
    
    
    
    1
    
    
    
    5
    
    
    
    6Severance charges (d)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Special items, net
    
    $
    (9
    )
    
    $
    1
    
    
    $
    (4
    )
    
    $
    7
 
 (a)
    
    In the second quarter of 2010, the Company recorded a $16 million refund of ASIF paid to the
Transportation Security Administration (TSA) during the years 2005 to 2009.(b)
    
    In the second quarter of 2010, the Company recorded other net special charges of $7 million,
which included a settlement and corporate transaction costs.(c)
    
    In the six months ended June 30, 2010, the Company recorded $5 million in aircraft costs as a
result of previously announced capacity reductions.In the three and six months ended June 30, 2009, the Company recorded $1 million and $6 million
in aircraft costs, respectively, as a result of capacity reductions.(d)
    
    In the six months ended June 30, 2009, the Company recorded $1 million in severance charges
as a result of capacity reductions.  9




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##### Table of Contents



3. Earnings (Loss) Per Common Share
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,
    
    
    June 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Basic earnings (loss) per share:Net income (loss)
    
    $
    279
    
    
    $
    58
    
    
    $
    235
    
    
    $
    (45
    )Weighted average common shares outstanding (in thousands)
    
    
    161,292
    
    
    
    123,790
    
    
    
    161,204
    
    
    
    118,956Basic earnings (loss) per share
    
    $
    1.73
    
    
    $
    0.47
    
    
    $
    1.46
    
    
    $
    (0.38
    )Diluted earnings (loss) per share:Net income (loss)
    
    $
    279
    
    
    $
    58
    
    
    $
    235
    
    
    $
    (45
    )Interest expense on 7.25% convertible senior notes
    
    
    6
    
    
    
    3
    
    
    
    11
    
    
    
    Interest expense on 7% senior convertible notes
    
    
    3
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss) for purposes of computing diluted
earnings (loss) per share
    
    $
    288
    
    
    $
    61
    
    
    $
    246
    
    
    $
    (45
    )Share computation (in thousands):Weighted average common shares outstanding
    
    
    161,292
    
    
    
    123,790
    
    
    
    161,204
    
    
    
    118,956Dilutive effect of stock awards
    
    
    1,722
    
    
    
    10
    
    
    
    1,454
    
    
    
    Assumed conversion of 7.25% convertible senior notes
    
    
    37,746
    
    
    
    20,325
    
    
    
    37,746
    
    
    
    Assumed conversion of 7% senior convertible notes
    
    
    3,049
    
    
    
    
    
    
    
    
    
    
    
    Weighted average common shares outstanding as adjusted
    
    
    203,809
    
    
    
    144,125
    
    
    
    200,404
    
    
    
    118,956Diluted earnings (loss) per share
    
    $
    1.41
    
    
    $
    0.42
    
    
    $
    1.23
    
    
    $
    (0.38
    )
     10




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##### Table of Contents



4. Debt
  June 30,
    
    
    December 31,2010
    
    
    2009SecuredCiticorp North America loan, variable interest rate of 2.81%, installments due through 2014
    
    $
    1,152
    
    
    $
    1,168Equipment loans and other notes payable, fixed and variable interest rates ranging from 1.75% to
10.46%, maturing from 2010 to 2021
    
    
    2,305
    
    
    
    2,201Aircraft enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 7.08%
to 9.01%, maturing from 2015 to 2022
    
    
    481
    
    
    
    505Other secured obligations, fixed interest rates ranging from 8% to 8.08%, maturing from 2015 to 2021
    
    
    83
    
    
    
    84Senior secured discount notes
    
    
    
    
    
    
    324,021
    
    
    
    3,990UnsecuredBarclays prepaid miles, variable interest rate of 5.1%, interest only payments
    
    
    200
    
    
    
    200Airbus advance, repayments through 2018
    
    
    251
    
    
    
    2477.25% convertible senior notes, interest only payments until due in 2014
    
    
    172
    
    
    
    1727% senior convertible notes, interest only payments until due in 2020 (a)
    
    
    74
    
    
    
    74Industrial development bonds, fixed interest rate of 6.3%, interest only payments until due in 2023
    
    
    29
    
    
    
    29Other unsecured obligations, maturing from 2011 to 2012
    
    
    30
    
    
    
    81756
    
    
    
    803Total long-term debt and capital lease obligations
    
    
    4,777
    
    
    
    4,793Less: Total unamortized discount on debt
    
    
    (241
    )
    
    
    (267
    )Current maturities, less $2 million and $9 million of unamortized discount on debt at June 30,
2010 and December 31, 2009, respectively
    
    
    (475
    )
    
    
    (502
    )Long-term debt and capital lease obligations, net of current maturities
    
    $
    4,061
    
    
    $
    4,024
 
 The Company was in compliance with the covenants in its debt agreements at June 30, 2010.(a)
    
    As of June 30, 2010, the Company has $74 million of principal amount outstanding under its 7%
Senior Convertible Notes (the 7% notes). The 7% notes may be converted by the holders into
common stock at an effective conversion price of $24.12 per share. Holders may require the
Company to purchase for cash or shares or a combination thereof, at the Companys election,
all or a portion of their 7% notes on September 30, 2010 and September 30, 2015 at a purchase
price equal to 100% of the principal amount of the 7% notes to be repurchased plus accrued and
unpaid interest, if any, to the purchase date. If the holders require the Company to
repurchase the notes, the Company will provide notice on or before the 20th day prior to the
purchase date stating, among other things, the amount of the repurchase price, whether the
Company elects to deliver shares of common stock to satisfy all or a portion of the purchase
price and the procedures that holders must follow to require the Company to repurchase their
notes. If the Company elects to deliver, in full or in partial satisfaction of the purchase
price, shares of its common stock, the number of such shares the Company delivers shall be
equal to the portion of the purchase price to be paid in common stock divided by the market
price (less a 2.5% discount) of a share of the Companys common stock. The Company is
currently evaluating its options in regards to these notes. 2010 Financing Transactions
  Fair Value of Debt
   11




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##### Table of Contents



5. Income Taxes
    6. Express Expenses
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Aircraft fuel and related taxes
    
    $
    195
    
    
    $
    145
    
    
    $
    365
    
    
    $
    267Salaries and related costs
    
    
    63
    
    
    
    61
    
    
    
    126
    
    
    
    124Capacity purchases
    
    
    273
    
    
    
    268
    
    
    
    537
    
    
    
    531Aircraft rent
    
    
    13
    
    
    
    13
    
    
    
    26
    
    
    
    26Aircraft maintenance
    
    
    17
    
    
    
    20
    
    
    
    36
    
    
    
    43Other rent and landing fees
    
    
    32
    
    
    
    30
    
    
    
    63
    
    
    
    61Selling expenses
    
    
    44
    
    
    
    40
    
    
    
    80
    
    
    
    74Special items, net (a)
    
    
    (1
    )
    
    
    
    
    
    
    (1
    )
    
    
    Depreciation and amortization
    
    
    6
    
    
    
    6
    
    
    
    12
    
    
    
    12Other expenses
    
    
    41
    
    
    
    42
    
    
    
    89
    
    
    
    90Express expenses
    
    $
    683
    
    
    $
    625
    
    
    $
    1,333
    
    
    $
    1,228
 (a)
    
    In the second quarter of 2010, the Company recorded a $1 million refund for its Express
subsidiaries of ASIF paid to the TSA during the years 2005 to 2009. 7. Derivative Instruments
   12




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##### Table of Contents



8. Investments in Marketable Securities
 Current
  Noncurrent
     9. Fair Value Measurements
  Quoted Prices in
    
    
    Significant Other
    
    
    SignificantActive Markets for
    
    
    Observable
    
    
    UnobservableIdentical Assets
    
    
    Inputs
    
    
    Inputs
    
    
    ValuationFair Value
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    TechniqueAt June 30, 2010Investments in marketable securities (noncurrent)
    
    $
    59
    
    
    $
    
    
    
    $
    
    
    
    $
    59
    
    
    
    (1
    )At December 31, 2009Investments in marketable securities (noncurrent)
    
    $
    203
    
    
    $
    
    
    
    $
    
    
    
    $
    203
    
    
    
    (1
    )
 (1)
    
    The Company estimated the fair value of its auction rate securities based on the following:
(i) the underlying structure of each security; (ii) the present value of future principal and
interest payments discounted at rates considered to reflect current market conditions; (iii)
consideration of the probabilities of default, passing a future auction, or repurchase at par
for each period; and (iv) estimates of the recovery rates in the event of default for each
security. These estimated fair values could change significantly based on future market
conditions. Refer to Note 8 for further discussion of the Companys investments in marketable
securities.  13




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##### Table of Contents



Investments inMarketableSecurities(Noncurrent)Balance at December 31, 2009
    
    $
    203Sales of marketable securities
    
    
    (143
    )Net unrealized losses recorded to other comprehensive income
    
    
    (1
    )Balance at June 30, 2010
    
    $
    59
 10. Other Comprehensive Income (Loss)
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Net income (loss)
    
    $
    279
    
    
    $
    58
    
    
    $
    235
    
    
    $
    (45
    )Recognition of net realized gains on sale of available-for-sale securities
    
    
    (4
    )
    
    
    
    
    
    
    (52
    )
    
    
    Net unrealized gains (losses) on available-for-sale securities
    
    
    
    
    
    
    34
    
    
    
    (1
    )
    
    
    34Pension and other postretirement benefits
    
    
    (1
    )
    
    
    (1
    )
    
    
    (2
    )
    
    
    (5
    )Total comprehensive income (loss)
    
    $
    274
    
    
    $
    91
    
    
    $
    180
    
    
    $
    (16
    )
  June 30,
    
    
    December 31,2010
    
    
    2009Pension and other postretirement benefits
    
    $
    53
    
    
    $
    55Available-for-sale securities
    
    
    (18
    )
    
    
    35Accumulated other comprehensive income
    
    $
    35
    
    
    $
    90
 11. Slot Exchange
    14




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##### Table of Contents



Item 1B. Condensed Consolidated Financial Statements of US Airways, Inc.
 US Airways, Inc.
 
 Condensed Consolidated Statements of Operations
 (In millions)
 (Unaudited)
 Three Months
    
    
    Six MonthsEnded June 30,
    
    
    Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Operating revenues:Mainline passenger
    
    $
    2,036
    
    
    $
    1,724
    
    
    $
    3,735
    
    
    $
    3,335Express passenger
    
    
    767
    
    
    
    642
    
    
    
    1,368
    
    
    
    1,194Cargo
    
    
    37
    
    
    
    20
    
    
    
    69
    
    
    
    44Other
    
    
    369
    
    
    
    310
    
    
    
    721
    
    
    
    614Total operating revenues
    
    
    3,209
    
    
    
    2,696
    
    
    
    5,893
    
    
    
    5,187Operating expenses:Aircraft fuel and related taxes
    
    
    616
    
    
    
    440
    
    
    
    1,151
    
    
    
    819Loss (gain) on fuel hedging instruments, net
    
    
    
    
    
    
    (21
    )
    
    
    
    
    
    
    5Salaries and related costs
    
    
    573
    
    
    
    549
    
    
    
    1,128
    
    
    
    1,100Express expenses
    
    
    721
    
    
    
    656
    
    
    
    1,396
    
    
    
    1,287Aircraft rent
    
    
    169
    
    
    
    174
    
    
    
    340
    
    
    
    352Aircraft maintenance
    
    
    162
    
    
    
    184
    
    
    
    319
    
    
    
    358Other rent and landing fees
    
    
    135
    
    
    
    142
    
    
    
    270
    
    
    
    273Selling expenses
    
    
    107
    
    
    
    99
    
    
    
    201
    
    
    
    192Special items, net
    
    
    (9
    )
    
    
    1
    
    
    
    (4
    )
    
    
    7Depreciation and amortization
    
    
    65
    
    
    
    64
    
    
    
    128
    
    
    
    126Other
    
    
    308
    
    
    
    287
    
    
    
    612
    
    
    
    573Total operating expenses
    
    
    2,847
    
    
    
    2,575
    
    
    
    5,541
    
    
    
    5,092Operating income
    
    
    362
    
    
    
    121
    
    
    
    352
    
    
    
    95Nonoperating income (expense):Interest income
    
    
    3
    
    
    
    6
    
    
    
    9
    
    
    
    13Interest expense, net
    
    
    (62
    )
    
    
    (64
    )
    
    
    (121
    )
    
    
    (125
    )Other, net
    
    
    (8
    )
    
    
    6
    
    
    
    32
    
    
    
    (9
    )Total nonoperating expense, net
    
    
    (67
    )
    
    
    (52
    )
    
    
    (80
    )
    
    
    (121
    )Income (loss) before income taxes
    
    
    295
    
    
    
    69
    
    
    
    272
    
    
    
    (26
    )Income tax provision
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss)
    
    $
    295
    
    
    $
    69
    
    
    $
    272
    
    
    $
    (26
    )
   15




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##### Table of Contents



US Airways, Inc.
 
 Condensed Consolidated Balance Sheets
 (In millions, except share and per share amounts)
 (Unaudited)
 June 30,
    
    
    December 31,2010
    
    
    2009ASSETSCurrent assetsCash and cash equivalents
    
    $
    1,772
    
    
    $
    1,209Investments in marketable securities
    
    
    180
    
    
    
    Accounts receivable, net
    
    
    391
    
    
    
    282Materials and supplies, net
    
    
    193
    
    
    
    188Prepaid expenses and other
    
    
    489
    
    
    
    507Total current assets
    
    
    3,025
    
    
    
    2,186Property and equipmentFlight equipment
    
    
    3,957
    
    
    
    3,710Ground property and equipment
    
    
    849
    
    
    
    856Less accumulated depreciation and amortization
    
    
    (1,196
    )
    
    
    (1,098
    )3,610
    
    
    
    3,468Equipment purchase deposits
    
    
    63
    
    
    
    112Total property and equipment
    
    
    3,673
    
    
    
    3,580Other assetsOther intangibles, net of accumulated amortization of $118 million and $106 million, respectively
    
    
    455
    
    
    
    467Restricted cash
    
    
    442
    
    
    
    480Investments in marketable securities
    
    
    59
    
    
    
    203Other assets
    
    
    206
    
    
    
    207Total other assets
    
    
    1,162
    
    
    
    1,357Total assets
    
    $
    7,860
    
    
    $
    7,123LIABILITIES & STOCKHOLDERS EQUITYCurrent liabilitiesCurrent maturities of debt and capital leases
    
    $
    388
    
    
    $
    418Accounts payable
    
    
    354
    
    
    
    319Payables to related parties, net
    
    
    672
    
    
    
    642Air traffic liability
    
    
    1,215
    
    
    
    778Accrued compensation and vacation
    
    
    200
    
    
    
    171Accrued taxes
    
    
    212
    
    
    
    142Other accrued expenses
    
    
    809
    
    
    
    815Total current liabilities
    
    
    3,850
    
    
    
    3,285Noncurrent liabilities and deferred creditsLong-term debt and capital leases, net of current maturities
    
    
    2,705
    
    
    
    2,667Deferred gains and credits, net
    
    
    292
    
    
    
    317Postretirement benefits other than pensions
    
    
    128
    
    
    
    129Employee benefit liabilities and other
    
    
    413
    
    
    
    470Total noncurrent liabilities and deferred credits
    
    
    3,538
    
    
    
    3,583Commitments and contingenciesStockholders equityCommon stock, $1 par value, 1,000 shares issued and outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    2,445
    
    
    
    2,445Accumulated other comprehensive income
    
    
    39
    
    
    
    94Accumulated deficit
    
    
    (2,012
    )
    
    
    (2,284
    )Total stockholders equity
    
    
    472
    
    
    
    255Total liabilities and stockholders equity
    
    $
    7,860
    
    
    $
    7,123
   16




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##### Table of Contents



US Airways, Inc.
 
 Condensed Consolidated Statements of Cash Flows
 (In millions)
 (Unaudited)
 Six Months Ended June 30,2010
    
    
    2009Net cash provided by operating activities
    
    $
    764
    
    
    $
    346Cash flows from investing activities:Purchases of property and equipment
    
    
    (87
    )
    
    
    (618
    )Purchases of marketable securities
    
    
    (180
    )
    
    
    Sales of marketable securities
    
    
    143
    
    
    
    20Decrease in long-term restricted cash
    
    
    38
    
    
    
    6Proceeds from sale-leaseback transactions and dispositions of property and equipment
    
    
    2
    
    
    
    52Net cash used in investing activities
    
    
    (84
    )
    
    
    (540
    )Cash flows from financing activities:Repayments of debt and capital lease obligations
    
    
    (204
    )
    
    
    (159
    )Proceeds from issuance of debt
    
    
    90
    
    
    
    576Deferred financing costs
    
    
    (3
    )
    
    
    (3
    )Net cash provided by (used in) financing activities
    
    
    (117
    )
    
    
    414Net increase in cash and cash equivalents
    
    
    563
    
    
    
    220Cash and cash equivalents at beginning of period
    
    
    1,209
    
    
    
    1,026Cash and cash equivalents at end of period
    
    $
    1,772
    
    
    $
    1,246Non-cash investing and financing activities:Note payables issued for aircraft purchases
    
    $
    111
    
    
    $
    32Interest payable converted to debt
    
    
    22
    
    
    
    19Net unrealized loss (gain) on available-for-sale securities
    
    
    1
    
    
    
    (34
    )Deposit applied to principal repayment on debt
    
    
    (19
    )
    
    
    Maintenance payable converted to debt
    
    
    
    
    
    
    10Supplemental information:Interest paid, net of amounts capitalized
    
    $
    81
    
    
    $
    75Income taxes paid
    
    
    
    
    
    
    
   17




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##### Table of Contents



US Airways, Inc.
 
 Notes to Condensed Consolidated Financial Statements
 (Unaudited)
 1. Basis of Presentation
   Recent Accounting Pronouncements
    18




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##### Table of Contents



2. Special Items, Net
  Three Months
    
    
    Six MonthsEnded June 30,
    
    
    Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Aviation Security Infrastructure Fee (ASIF) refund (a)
    
    $
    (16
    )
    
    $
    
    
    
    $
    (16
    )
    
    $
    Other costs (b)
    
    
    7
    
    
    
    
    
    
    
    7
    
    
    
    Aircraft costs (c)
    
    
    
    
    
    
    1
    
    
    
    5
    
    
    
    6Severance charges (d)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Special items, net
    
    $
    (9
    )
    
    $
    1
    
    
    $
    (4
    )
    
    $
    7
 
 (a)
    
    In the second quarter of 2010, US Airways recorded a $16 million refund of ASIF paid to the
Transportation Security Administration (TSA) during the years 2005 to 2009.(b)
    
    In the second quarter of 2010, US Airways recorded other net special charges of $7 million,
which included a settlement and corporate transaction costs.(c)
    
    In the six months ended June 30, 2010, US Airways recorded $5 million in aircraft costs as a
result of previously announced capacity reductions.In the three and six months ended June 30, 2009, US Airways recorded $1 million and $6 million
in aircraft costs, respectively, as a result of capacity reductions.(d)
    
    In the six months ended June 30, 2009, US Airways recorded $1 million in severance charges as
a result of capacity reductions.  19




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##### Table of Contents



3. Debt
  June 30,
    
    
    December 31,2010
    
    
    2009SecuredEquipment loans and other notes payable, fixed and variable interest rates ranging from 1.75% to
10.46%, maturing from 2010 to 2021
    
    
    2,305
    
    
    
    2,201Aircraft enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 7.08%
to 9.01%, maturing from 2015 to 2022
    
    
    481
    
    
    
    505Other secured obligations, fixed interest rates ranging from 8% to 8.08%, maturing from 2015 to 2021
    
    
    83
    
    
    
    84Senior secured discount notes
    
    
    
    
    
    
    322,869
    
    
    
    2,822UnsecuredAirbus advance, repayments through 2018
    
    
    251
    
    
    
    247Industrial development bonds, fixed interest rate of 6.3%, interest only payments until due in 2023
    
    
    29
    
    
    
    29Other unsecured obligations, maturing from 2011 to 2012
    
    
    30
    
    
    
    81310
    
    
    
    357Total long-term debt and capital lease obligations
    
    
    3,179
    
    
    
    3,179Less: Total unamortized discount on debt
    
    
    (86
    )
    
    
    (94
    )Current maturities, less $4 million of unamortized discount on debt at December 31, 2009
    
    
    (388
    )
    
    
    (418
    )Long-term debt and capital lease obligations, net of current maturities
    
    $
    2,705
    
    
    $
    2,667
  2010 Financing Transactions
  Fair Value of Debt
  4. Related Party Transactions
  June 30, 2010
    
    
    December 31, 2009US Airways Group
    
    $
    626
    
    
    $
    607US Airways Groups wholly owned subsidiaries
    
    
    46
    
    
    
    35$
    672
    
    
    $
    642
    20




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##### Table of Contents



5. Income Taxes
     6. Express Expenses
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Aircraft fuel and related taxes
    
    $
    196
    
    
    $
    145
    
    
    $
    366
    
    
    $
    267Salaries and related costs
    
    
    6
    
    
    
    6
    
    
    
    12
    
    
    
    12Capacity purchases
    
    
    427
    
    
    
    418
    
    
    
    839
    
    
    
    836Other rent and landing fees
    
    
    27
    
    
    
    25
    
    
    
    53
    
    
    
    51Selling expenses
    
    
    44
    
    
    
    40
    
    
    
    80
    
    
    
    74Other expenses
    
    
    21
    
    
    
    22
    
    
    
    46
    
    
    
    47Express expenses
    
    $
    721
    
    
    $
    656
    
    
    $
    1,396
    
    
    $
    1,287
 7. Derivative Instruments
   21




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##### Table of Contents



8. Investments in Marketable Securities
 Current
  Noncurrent
     9. Fair Value Measurements
  Quoted Prices in
    
    
    Significant Other
    
    
    SignificantActive Markets for
    
    
    Observable
    
    
    UnobservableIdentical Assets
    
    
    Inputs
    
    
    Inputs
    
    
    ValuationFair Value
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    TechniqueAt June 30, 2010Investments in marketable securities (noncurrent)
    
    $
    59
    
    
    $
    
    
    
    $
    
    
    
    $
    59
    
    
    
    (1
    )At December 31, 2009Investments in marketable securities (noncurrent)
    
    $
    203
    
    
    $
    
    
    
    $
    
    
    
    $
    203
    
    
    
    (1
    )
 (1)
    
    US Airways estimated the fair value of its auction rate securities based on the following:
(i) the underlying structure of each security; (ii) the present value of future principal and
interest payments discounted at rates considered to reflect current market conditions; (iii)
consideration of the probabilities of default, passing a future auction, or repurchase at par
for each period; and (iv) estimates of the recovery rates in the event of default for each
security. These estimated fair values could change significantly based on future market
conditions. Refer to Note 8 for further discussion of US Airways investments in marketable
securities.  22




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##### Table of Contents



Investments inMarketableSecurities(Noncurrent)Balance at December 31, 2009
    
    $
    203Sales of marketable securities
    
    
    (143
    )Net unrealized losses recorded to other comprehensive income
    
    
    (1
    )Balance at June 30, 2010
    
    $
    59
 10. Other Comprehensive Income
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Net income (loss)
    
    $
    295
    
    
    $
    69
    
    
    $
    272
    
    
    $
    (26
    )Recognition of net realized gains on sale of available-for-sale securities
    
    
    (4
    )
    
    
    
    
    
    
    (52
    )
    
    
    Net unrealized gains (losses) on available-for-sale securities
    
    
    
    
    
    
    34
    
    
    
    (1
    )
    
    
    34Other postretirement benefits
    
    
    (1
    )
    
    
    (1
    )
    
    
    (2
    )
    
    
    (5
    )Total comprehensive income
    
    $
    290
    
    
    $
    102
    
    
    $
    217
    
    
    $
    3
  June 30,
    
    
    December 31,2010
    
    
    2009Other postretirement benefits
    
    $
    57
    
    
    $
    59Available-for-sale securities
    
    
    (18
    )
    
    
    35Accumulated other comprehensive income
    
    $
    39
    
    
    $
    94
 11. Slot Exchange
    23




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Background
   The U.S. Airline Industry
      24




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##### Table of Contents



US Airways
  Fuel
  Cost Control
   Percent2010
    
    
    2009
    
    
    Change(In cents)Mainline CASM excluding special items, fuel and profit sharing:Total mainline CASM
    
    
    11.48
    
    
    
    10.44
    
    
    
    10.0Special items, net
    
    
    0.05
    
    
    
    
    
    
    
    nmAircraft fuel and related taxes
    
    
    (3.34
    )
    
    
    (2.41
    )
    
    
    38.9Gain on fuel hedging instruments, net
    
    
    
    
    
    
    0.12
    
    
    
    nmProfit sharing
    
    
    (0.10
    )
    
    
    
    
    
    
    nmTotal mainline CASM excluding special items, fuel and profit sharing (1)
    
    
    8.08
    
    
    
    8.14
    
    
    
    (0.7
    )
 (1)
    
    We believe that the presentation of mainline CASM excluding fuel is useful to
investors as both the cost and availability of fuel are subject to many economic and
political factors beyond our control, and excluding special items and profit sharing provides
investors the ability to measure financial performance in a way that is more indicative of
our ongoing performance and is more comparable to measures reported by other major airlines.
Management uses mainline CASM excluding special items, fuel and profit sharing to evaluate
our operating performance. Amounts may not recalculate due to rounding.   25




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##### Table of Contents



Customer Service
    2010
    
    
    2009
    
    
    Percent Better (Worse) 2010-2009April
    
    
    May
    
    
    June (e)
    
    
    April
    
    
    May
    
    
    June
    
    
    April
    
    
    May
    
    
    JuneOn-time performance (a)
    
    
    88.6
    
    
    
    85.3
    
    
    
    83.4
    
    
    
    79.9
    
    
    
    79.2
    
    
    
    78.0
    
    
    
    10.9
    
    
    
    7.7
    
    
    
    6.9Completion factor (b)
    
    
    99.6
    
    
    
    99.4
    
    
    
    99.3
    
    
    
    99.1
    
    
    
    99.1
    
    
    
    98.9
    
    
    
    0.5
    
    
    
    0.3
    
    
    
    0.4Mishandled baggage (c)
    
    
    2.07
    
    
    
    2.27
    
    
    
    2.53
    
    
    
    2.88
    
    
    
    2.91
    
    
    
    2.86
    
    
    
    28.1
    
    
    
    22.0
    
    
    
    11.5Customer complaints (d)
    
    
    1.55
    
    
    
    1.19
    
    
    
    1.81
    
    
    
    1.35
    
    
    
    1.34
    
    
    
    1.38
    
    
    
    (14.8
    )
    
    
    11.2
    
    
    
    (31.2
    )
 
 (a)
    
    Percentage of reported flight operations arriving on time as defined by the DOT.(b)
    
    Percentage of scheduled flight operations completed.(c)
    
    Rate of mishandled baggage reports per 1,000 passengers.(d)
    
    Rate of customer complaints filed with the DOT per 100,000 passengers.(e)
    
    June 2010 operating statistics are preliminary as the DOT has not issued its June 2010 Air
Travel Consumer Report as of the date of this filing. Liquidity Position
  June 30,
    
    
    December 31,2010
    
    
    2009(In millions)Cash and cash equivalents and short-term investments in marketable securities
    
    $
    1,994
    
    
    $
    1,299Long-term restricted cash
    
    
    442
    
    
    
    480Long-term investments in marketable securities
    
    
    59
    
    
    
    203Total cash, cash equivalents, investments in marketable securities and restricted cash
    
    $
    2,495
    
    
    $
    1,982
   26




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##### Table of Contents



Status of Strategic Initiatives
 Delta Slot Transaction
   2010 Outlook
   27




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##### Table of Contents



US Airways Groups Results of Operations
  
    
    $9 million of net special credits, consisting of a $16 million refund of
Aviation Security Infrastructure Fees (ASIF) paid to the Transportation Security
Administration (TSA) during the years 2005 to 2009, offset by other net special charges of
$7 million, which included a settlement and corporate transaction costs;
 
    
    $1 million refund for our Express subsidiaries of ASIF paid to the TSA during
the years 2005 to 2009; and
 
    
    $4 million of net realized gains related to sales of certain investments in
auction rate securities, included in nonoperating expense, net.
  
    
    $156 million of net unrealized gains resulting from the application of
mark-to-market accounting for changes in the fair value of fuel
hedging instruments. These unrealized
gains were due primarily to the reversal of unrealized losses recognized in prior periods as
hedge transactions settled in the 2009 period;
 
    
    $1 million of net special charges for aircraft costs as a result of capacity
reductions; and
 
    
    a $2 million non-cash asset impairment charge, included in nonoperating expense,
net.
  
    
    $4 million of net special credits, consisting of a $16 million refund of ASIF
paid to the TSA during the years 2005 to 2009, offset by other net special charges of $7
million, which included a settlement and corporate transaction costs and $5 million in
aircraft costs as a result of previously announced capacity reductions;
 
    
    $1 million refund for our Express subsidiaries of ASIF paid to the TSA during
the years 2005 to 2009; and
 
    
    $53 million of net realized gains related to sales of certain investments in
auction rate securities, included in nonoperating expense, net.
  
    
    $327 million of net unrealized gains resulting from the application of mark-to-market
accounting for changes in the fair value of fuel hedging instruments;
 
    
    $7 million of net special charges, consisting of $6 million in aircraft costs
and $1 million in severance charges, both as a result of capacity reductions; and
 
    
    $7 million in other-than-temporary non-cash impairment charges for investments
in auction rate securities as well as a $2 million non-cash asset impairment charge, all
included in nonoperating expense, net.
   28




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Three Months Ended
    
    
    Percent
    
    
    Six Months Ended
    
    
    PercentJune 30,
    
    
    Change
    
    
    June 30,
    
    
    Change2010
    
    
    2009
    
    
    2010-2009
    
    
    2010
    
    
    2009
    
    
    2010-2009MainlineRevenue passenger miles (millions) (a)
    
    
    15,530
    
    
    
    15,526
    
    
    
    
    
    
    
    28,583
    
    
    
    28,834
    
    
    
    (0.9
    )Available seat miles (millions) (b)
    
    
    18,440
    
    
    
    18,310
    
    
    
    0.7
    
    
    
    35,019
    
    
    
    35,289
    
    
    
    (0.8
    )Passenger load factor (percent) (c)
    
    
    84.2
    
    
    
    84.8
    
    
    
    (0.6
    ) pts
    
    
    81.6
    
    
    
    81.7
    
    
    
    (0.1
    ) ptsYield (cents) (d)
    
    
    13.11
    
    
    
    11.11
    
    
    
    18.1
    
    
    
    13.07
    
    
    
    11.57
    
    
    
    13.0Passenger revenue per available seat mile (cents) (e)
    
    
    11.04
    
    
    
    9.42
    
    
    
    17.3
    
    
    
    10.66
    
    
    
    9.45
    
    
    
    12.8Operating cost per available seat mile (cents) (f)
    
    
    11.48
    
    
    
    10.44
    
    
    
    10.0
    
    
    
    11.79
    
    
    
    10.73
    
    
    
    9.8Passenger enplanements (thousands) (g)
    
    
    13,381
    
    
    
    13,440
    
    
    
    (0.4
    )
    
    
    25,366
    
    
    
    25,850
    
    
    
    (1.9
    )Departures (thousands)
    
    
    114
    
    
    
    118
    
    
    
    (3.4
    )
    
    
    222
    
    
    
    235
    
    
    
    (5.4
    )Aircraft at end of period
    
    
    345
    
    
    
    350
    
    
    
    (1.4
    )
    
    
    345
    
    
    
    350
    
    
    
    (1.4
    )Block hours (thousands) (h)
    
    
    306
    
    
    
    317
    
    
    
    (3.6
    )
    
    
    592
    
    
    
    621
    
    
    
    (4.7
    )Average stage length (miles) (i)
    
    
    996
    
    
    
    984
    
    
    
    1.2
    
    
    
    978
    
    
    
    959
    
    
    
    1.9Average passenger journey (miles) (j)
    
    
    1,703
    
    
    
    1,655
    
    
    
    2.9
    
    
    
    1,654
    
    
    
    1,593
    
    
    
    3.8Fuel consumption (gallons in millions)
    
    
    276
    
    
    
    278
    
    
    
    (0.6
    )
    
    
    523
    
    
    
    536
    
    
    
    (2.4
    )Average aircraft fuel price including related taxes
(dollars per gallon)
    
    
    2.23
    
    
    
    1.58
    
    
    
    40.8
    
    
    
    2.20
    
    
    
    1.53
    
    
    
    44.0Full-time equivalent employees at end of period
    
    
    30,860
    
    
    
    32,393
    
    
    
    (4.7
    )
    
    
    30,860
    
    
    
    32,393
    
    
    
    (4.7
    )Express (k)Revenue passenger miles (millions) (a)
    
    
    2,777
    
    
    
    2,809
    
    
    
    (1.1
    )
    
    
    5,047
    
    
    
    5,183
    
    
    
    (2.6
    )Available seat miles (millions) (b)
    
    
    3,630
    
    
    
    3,676
    
    
    
    (1.3
    )
    
    
    6,909
    
    
    
    7,132
    
    
    
    (3.1
    )Passenger load factor (percent) (c)
    
    
    76.5
    
    
    
    76.4
    
    
    
    0.1
    pts
    
    
    73.0
    
    
    
    72.7
    
    
    
    0.3
    ptsYield (cents) (d)
    
    
    27.60
    
    
    
    22.87
    
    
    
    20.7
    
    
    
    27.10
    
    
    
    23.03
    
    
    
    17.7Passenger revenue per available seat mile (cents) (e)
    
    
    21.12
    
    
    
    17.47
    
    
    
    20.9
    
    
    
    19.80
    
    
    
    16.74
    
    
    
    18.3Operating cost per available seat mile (cents) (f)
    
    
    18.83
    
    
    
    16.99
    
    
    
    10.8
    
    
    
    19.29
    
    
    
    17.23
    
    
    
    12.0Passenger enplanements (thousands) (g)
    
    
    7,261
    
    
    
    7,051
    
    
    
    3.0
    
    
    
    13,208
    
    
    
    13,029
    
    
    
    1.4Aircraft at end of period
    
    
    282
    
    
    
    290
    
    
    
    (2.8
    )
    
    
    282
    
    
    
    290
    
    
    
    (2.8
    )Fuel consumption (gallons in millions)
    
    
    86
    
    
    
    87
    
    
    
    (1.1
    )
    
    
    163
    
    
    
    168
    
    
    
    (3.0
    )Average aircraft fuel price including related taxes
(dollars per gallon)
    
    
    2.28
    
    
    
    1.67
    
    
    
    36.4
    
    
    
    2.24
    
    
    
    1.59
    
    
    
    40.7Total Mainline and ExpressRevenue passenger miles (millions) (a)
    
    
    18,307
    
    
    
    18,335
    
    
    
    (0.1
    )
    
    
    33,630
    
    
    
    34,017
    
    
    
    (1.1
    )Available seat miles (millions) (b)
    
    
    22,070
    
    
    
    21,986
    
    
    
    0.4
    
    
    
    41,928
    
    
    
    42,421
    
    
    
    (1.2
    )Passenger load factor (percent) (c)
    
    
    82.9
    
    
    
    83.4
    
    
    
    (0.5
    ) pts
    
    
    80.2
    
    
    
    80.2
    
    
    
    
    ptsYield (cents) (d)
    
    
    15.31
    
    
    
    12.91
    
    
    
    18.6
    
    
    
    15.17
    
    
    
    13.31
    
    
    
    14.0Passenger revenue per available seat mile (cents) (e)
    
    
    12.70
    
    
    
    10.76
    
    
    
    18.0
    
    
    
    12.17
    
    
    
    10.68
    
    
    
    14.0Total revenue per available seat mile (cents) (l)
    
    
    14.37
    
    
    
    12.09
    
    
    
    18.9
    
    
    
    13.88
    
    
    
    12.05
    
    
    
    15.2Passenger enplanements (thousands) (g)
    
    
    20,642
    
    
    
    20,491
    
    
    
    0.7
    
    
    
    38,574
    
    
    
    38,879
    
    
    
    (0.8
    )Aircraft at end of period
    
    
    627
    
    
    
    640
    
    
    
    (2.0
    )
    
    
    627
    
    
    
    640
    
    
    
    (2.0
    )Fuel consumption (gallons in millions)
    
    
    362
    
    
    
    365
    
    
    
    (0.7
    )
    
    
    686
    
    
    
    704
    
    
    
    (2.5
    )Average aircraft fuel price including related taxes
(dollars per gallon)
    
    
    2.24
    
    
    
    1.60
    
    
    
    39.7
    
    
    
    2.21
    
    
    
    1.54
    
    
    
    43.2
 
 (a)
    
    Revenue passenger mile (RPM)  A basic measure of sales volume. One RPM represents one
passenger flown one mile.(b)
    
    Available seat mile (ASM)  A basic measure of production. One ASM represents one seat
flown one mile.  29




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##### Table of Contents



(c)
    
    Passenger load factor  The percentage of available seats that are filled with revenue
passengers.(d)
    
    Yield  A measure of airline revenue derived by dividing passenger revenue by RPMs and
expressed in cents per mile.(e)
    
    Passenger revenue per available seat mile (PRASM)  Passenger revenues divided by ASMs.(f)
    
    Operating cost per available seat mile (CASM)  Operating expenses divided by ASMs.(g)
    
    Passenger enplanements  The number of passengers on board an aircraft, including local,
connecting and through passengers.(h)
    
    Block hours  The hours measured from the moment an aircraft first moves under its own power,
including taxi time, for the purposes of flight until the aircraft is docked at the next point
of landing and its power is shut down.(i)
    
    Average stage length  The average of the distances flown on each segment of every route.(j)
    
    Average passenger journey  The average one-way trip measured in miles for one passenger
origination.(k)
    
    Express statistics include Piedmont and PSA, as well as operating and financial results from
capacity purchase agreements with Air Wisconsin Airlines Corporation, Republic Airways, Mesa
Airlines, Inc. and Chautauqua Airlines, Inc.(l)
    
    Total revenue per available seat mile (RASM)  Total revenues divided by total mainline
and Express ASMs.  30




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##### Table of Contents



Three Months Ended June 30, 2010
Compared with the
Three Months Ended June 30, 2009
 Operating Revenues:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating revenues:Mainline passenger
    
    $
    2,036
    
    
    $
    1,724
    
    
    
    18.1Express passenger
    
    
    767
    
    
    
    642
    
    
    
    19.3Cargo
    
    
    37
    
    
    
    20
    
    
    
    82.1Other
    
    
    331
    
    
    
    272
    
    
    
    22.3Total operating revenues
    
    $
    3,171
    
    
    $
    2,658
    
    
    
    19.3
  
    
    Mainline passenger revenues were $2.04 billion in the second quarter of 2010 as
compared to $1.72 billion in the 2009 period. Mainline RPMs were flat as mainline capacity,
as measured by ASMs, increased 0.7%, resulting in a 0.6 point decrease in load factor to
84.2%. Mainline passenger yield increased 18.1% to 13.11 cents in the second quarter of 2010
from 11.11 cents in the 2009 period. Mainline PRASM increased 17.3% to 11.04 cents in the
second quarter of 2010 from 9.42 cents in the 2009 period. These increases in mainline yield
and PRASM were due principally to an improved pricing environment driven by the recovering
economy, rebound of business travel and continued industry capacity discipline.
 
    
    Express passenger revenues were $767 million in the second quarter of 2010, an
increase of $125 million from the 2009 period. Express RPMs decreased 1.1% as Express
capacity, as measured by ASMs, decreased 1.3%, resulting in a 0.1 point increase in load
factor to 76.5%. Express passenger yield increased by 20.7% to 27.6 cents in the second
quarter of 2010 from 22.87 cents in the 2009 period. Express PRASM increased 20.9% to 21.12
cents in the second quarter of 2010 from 17.47 cents in the 2009 period. The increases in
Express yield and PRASM were the result of the same improved pricing environment discussed in
mainline passenger revenues above.
 
    
    Cargo revenues were $37 million in the second quarter of 2010, an increase of
$17 million, or 82.1%, from the 2009 period. The increase in cargo revenues was driven
primarily by an increase in freight volume as a result of the recovering economic environment
in the 2010 period.
 
    
    Other revenues were $331 million in the second quarter of 2010, an increase of
$59 million, or 22.3%, from the 2009 period, primarily due to an increase in revenue
generated by checked bag fees as a result of increases in rates charged. An increase in
revenues associated with our frequent traveler program also contributed to the increase in
other revenues.
  31




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Operating Expenses:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating expenses:Aircraft fuel and related taxes
    
    $
    616
    
    
    $
    440
    
    
    
    39.9Loss (gain) on fuel hedging instruments, net:Realized
    
    
    
    
    
    
    135
    
    
    
    nmUnrealized
    
    
    
    
    
    
    (156
    )
    
    
    nmSalaries and related costs
    
    
    573
    
    
    
    549
    
    
    
    4.3Aircraft rent
    
    
    169
    
    
    
    174
    
    
    
    (3.0
    )Aircraft maintenance
    
    
    162
    
    
    
    184
    
    
    
    (12.0
    )Other rent and landing fees
    
    
    135
    
    
    
    142
    
    
    
    (5.1
    )Selling expenses
    
    
    107
    
    
    
    99
    
    
    
    7.7Special items, net
    
    
    (9
    )
    
    
    1
    
    
    
    nmDepreciation and amortization
    
    
    63
    
    
    
    62
    
    
    
    2.2Other
    
    
    301
    
    
    
    281
    
    
    
    6.9Total mainline operating expenses
    
    
    2,117
    
    
    
    1,911
    
    
    
    10.8Express expenses:Fuel
    
    
    195
    
    
    
    145
    
    
    
    34.9Other
    
    
    488
    
    
    
    480
    
    
    
    1.8Total Express expenses
    
    
    683
    
    
    
    625
    
    
    
    9.5Total operating expenses
    
    $
    2,800
    
    
    $
    2,536
    
    
    
    10.4
     Percent2010
    
    
    2009
    
    
    Change(In cents)Mainline CASM:Aircraft fuel and related taxes
    
    
    3.34
    
    
    
    2.41
    
    
    
    38.9Gain on fuel hedging instruments, net
    
    
    
    
    
    
    (0.12
    )
    
    
    nmSalaries and related costs
    
    
    3.11
    
    
    
    3.00
    
    
    
    3.6Aircraft rent
    
    
    0.92
    
    
    
    0.95
    
    
    
    (3.6
    )Aircraft maintenance
    
    
    0.88
    
    
    
    1.01
    
    
    
    (12.6
    )Other rent and landing fees
    
    
    0.73
    
    
    
    0.78
    
    
    
    (5.7
    )Selling expenses
    
    
    0.58
    
    
    
    0.54
    
    
    
    7.0Special items, net
    
    
    (0.05
    )
    
    
    
    
    
    
    nmDepreciation and amortization
    
    
    0.34
    
    
    
    0.34
    
    
    
    Other
    
    
    1.63
    
    
    
    1.53
    
    
    
    6.2Total mainline CASM
    
    
    11.48
    
    
    
    10.44
    
    
    
    10.0Special items, net
    
    
    0.05
    
    
    
    Aircraft fuel and related taxes
    
    
    (3.34
    )
    
    
    (2.41
    )Gain on fuel hedging instruments, net
    
    
    
    
    
    
    0.12Profit sharing
    
    
    (0.10
    )
    
    
    Total mainline CASM excluding special items, fuel and profit sharing (1)
    
    
    8.08
    
    
    
    8.14
    
    
    
    (0.7
    )
 (1)
    
    We believe that the presentation of mainline CASM excluding fuel is useful to investors
as both the cost and availability of fuel are subject to many economic and political factors
beyond our control, and excluding special items and profit sharing provides investors the
ability to measure financial performance in a way that is more indicative of our ongoing
performance and is more comparable to measures reported by other major airlines. Management
uses mainline CASM excluding special items, fuel and profit sharing to evaluate our operating
performance. Amounts may not recalculate due to rounding.  32




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##### Table of Contents




    
    Aircraft fuel and related taxes per ASM increased 38.9% primarily due to a 40.8% increase
in the average price per gallon of fuel to $2.23 in the second quarter of 2010 from $1.58 in
the 2009 period.
 
    
    Since the third quarter of 2008, we have not entered into any new fuel hedging
transactions, and we have not had any fuel hedging contracts outstanding since the third
quarter of 2009. We recognized a net gain of $21 million in the second quarter of 2009
related to fuel hedging instruments.
 
    
    Salaries and related costs per ASM increased 3.6% primarily due to the accrual
of $18 million for profit sharing.
 
    
    Aircraft maintenance expense per ASM decreased 12.6% due principally to a
decrease in the number of engine overhauls performed in the 2010 period as compared to the
2009 period as a result of the timing of maintenance cycles.
 
    
    Selling expenses per ASM increased 7% due to higher credit card fees and
commissions paid as a result of the 18.1% increase in passenger revenues driven by the
improved pricing environment in the 2010 period.
 
    
    Other expense per ASM increased 6.2% due to higher costs associated with our
frequent traveler program, principally an increase in the incremental cost of providing
transportation for travel awards as a result of higher fuel costs in the 2010 period.
  Nonoperating Income (Expense):
 Percent2010
    
    
    2009
    
    
    Change(In millions)Nonoperating income (expense):Interest income
    
    $
    3
    
    
    $
    6
    
    
    
    (47.5
    )Interest expense, net
    
    
    (86
    )
    
    
    (77
    )
    
    
    11.3Other, net
    
    
    (9
    )
    
    
    7
    
    
    
    nmTotal nonoperating expense, net
    
    $
    (92
    )
    
    $
    (64
    )
    
    
    41.5
    33




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##### Table of Contents



Six Months Ended June 30, 2010
Compared with the
Six Months Ended June 30, 2009
 Operating Revenues:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating revenues:Mainline passenger
    
    $
    3,735
    
    
    $
    3,335
    
    
    
    12.0Express passenger
    
    
    1,368
    
    
    
    1,194
    
    
    
    14.6Cargo
    
    
    69
    
    
    
    44
    
    
    
    57.7Other
    
    
    649
    
    
    
    540
    
    
    
    20.2Total operating revenues
    
    $
    5,821
    
    
    $
    5,113
    
    
    
    13.9
  
    
    Mainline passenger revenues were $3.74 billion in the first six months of 2010
as compared to $3.34 billion in the 2009 period. Mainline RPMs decreased 0.9% as mainline
capacity, as measured by ASMs, decreased 0.8%, resulting in a 0.1 point decrease in load
factor to 81.6%. Mainline passenger yield increased 13% to 13.07 cents in the first six
months of 2010 from 11.57 cents in the 2009 period. Mainline PRASM increased 12.8% to 10.66
cents in the first six months of 2010 from 9.45 cents in the 2009 period. These increases in
mainline yield and PRASM were due principally to an improved pricing environment driven by
the recovering economy, rebound of business travel and continued industry capacity
discipline.
 
    
    Express passenger revenues were $1.37 billion in the first six months of 2010,
an increase of $174 million from the 2009 period. Express RPMs decreased by 2.6% as Express
capacity, as measured by ASMs, decreased 3.1%, resulting in a 0.3 point increase in load
factor to 73%. Express passenger yield increased by 17.7% to 27.1 cents in the first six
months of 2010 from 23.03 cents in the 2009 period. Express PRASM increased 18.3% to 19.8
cents in the first six months of 2010 from 16.74 cents in the 2009 period. The increases in
Express yield and PRASM were the result of the same improved pricing environment discussed in
mainline passenger revenues above.
 
    
    Cargo revenues were $69 million in the first six months of 2010, an increase of
$25 million, or 57.7%, from the 2009 period. The increase in cargo revenues was driven
primarily by an increase in freight volume as a result of the recovering economic environment
in the 2010 period.
 
    
    Other revenues were $649 million in the first six months of 2010, an increase of
$109 million, or 20.2%, from the 2009 period, primarily due to an increase in revenue
generated by checked bag fees as a result of increases in rates charged. An increase in
revenues associated with our frequent traveler program also contributed to the increase in
other revenues.
  34




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Operating Expenses:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating expenses:Aircraft fuel and related taxes
    
    $
    1,151
    
    
    $
    819
    
    
    
    40.5Loss (gain) on fuel hedging instruments, net:Realized
    
    
    
    
    
    
    332
    
    
    
    nmUnrealized
    
    
    
    
    
    
    (327
    )
    
    
    nmSalaries and related costs
    
    
    1,128
    
    
    
    1,100
    
    
    
    2.6Aircraft rent
    
    
    340
    
    
    
    352
    
    
    
    (3.4
    )Aircraft maintenance
    
    
    319
    
    
    
    358
    
    
    
    (11.0
    )Other rent and landing fees
    
    
    270
    
    
    
    273
    
    
    
    (1.3
    )Selling expenses
    
    
    201
    
    
    
    192
    
    
    
    5.1Special items, net
    
    
    (4
    )
    
    
    7
    
    
    
    nmDepreciation and amortization
    
    
    124
    
    
    
    121
    
    
    
    1.9Other
    
    
    598
    
    
    
    561
    
    
    
    6.9Total mainline operating expenses
    
    
    4,127
    
    
    
    3,788
    
    
    
    9.0Express expenses:Fuel
    
    
    365
    
    
    
    267
    
    
    
    36.5Other
    
    
    968
    
    
    
    961
    
    
    
    0.7Total Express expenses
    
    
    1,333
    
    
    
    1,228
    
    
    
    8.5Total operating expenses
    
    $
    5,460
    
    
    $
    5,016
    
    
    
    8.9
     Percent2010
    
    
    2009
    
    
    Change(In cents)Mainline CASM:Aircraft fuel and related taxes
    
    
    3.29
    
    
    
    2.32
    
    
    
    41.6Loss on fuel hedging instruments, net
    
    
    
    
    
    
    0.02
    
    
    
    nmSalaries and related costs
    
    
    3.22
    
    
    
    3.12
    
    
    
    3.4Aircraft rent
    
    
    0.97
    
    
    
    1.00
    
    
    
    (2.6
    )Aircraft maintenance
    
    
    0.91
    
    
    
    1.01
    
    
    
    (10.3
    )Other rent and landing fees
    
    
    0.77
    
    
    
    0.77
    
    
    
    Selling expenses
    
    
    0.58
    
    
    
    0.54
    
    
    
    5.9Special items, net
    
    
    (0.01
    )
    
    
    0.02
    
    
    
    nmDepreciation and amortization
    
    
    0.35
    
    
    
    0.34
    
    
    
    2.6Other
    
    
    1.71
    
    
    
    1.59
    
    
    
    7.8Total mainline CASM
    
    
    11.79
    
    
    
    10.73
    
    
    
    9.8Special items, net
    
    
    0.01
    
    
    
    (0.02
    )Aircraft fuel and related taxes
    
    
    (3.29
    )
    
    
    (2.32
    )Loss on fuel hedging instruments, net
    
    
    
    
    
    
    (0.02
    )Profit sharing
    
    
    (0.05
    )
    
    
    Total mainline CASM excluding special items, fuel and profit sharing (1)
    
    
    8.46
    
    
    
    8.38
    
    
    
    1.0
 (1)
    
    We believe that the presentation of mainline CASM excluding fuel is useful to investors
as both the cost and availability of fuel are subject to many economic and political factors
beyond our control, and excluding special items and profit sharing provides investors the
ability to measure financial performance in a way that is more indicative of our ongoing
performance and is more comparable to measures reported by other major airlines. Management
uses mainline CASM excluding special items, fuel and profit sharing to evaluate our operating
performance. Amounts may not recalculate due to rounding.  35




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##### Table of Contents




    
    Aircraft fuel and related taxes per ASM increased 41.6% primarily due to a 44% increase
in the average price per gallon of fuel to $2.20 in the first six months of 2010 from $1.53
in the 2009 period.
 
    
    Since the third quarter of 2008, we have not entered into any new fuel hedging
transactions, and we have not had any fuel hedging contracts outstanding since the third
quarter of 2009. We recognized a net loss of $5 million in the first six months of 2009
related to fuel hedging instruments.
 
    
    Salaries and related costs per ASM increased 3.4% primarily due to the accrual
of $18 million for profit sharing.
 
    
    Aircraft maintenance expense per ASM decreased 10.3% due principally to a
decrease in the number of engine overhauls performed in the 2010 period as compared to the
2009 period as a result of the timing of maintenance cycles.
 
    
    Selling expenses per ASM increased 5.9% due to higher credit card fees and
commissions paid as a result of the 12% increase in passenger revenues driven by the
improved pricing environment in the 2010 period.
 
    
    Other expense per ASM increased 7.8% primarily due to higher costs associated
with our frequent traveler program, principally an increase in the incremental cost of
providing transportation for travel awards as a result of higher fuel costs in the 2010
period. The negative effects of the severe weather on the East Coast of the United States in
the first quarter of 2010 also contributed to the increase in other expenses.
   36




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##### Table of Contents



Nonoperating Income (Expense):
 Percent2010
    
    
    2009
    
    
    Change(In millions)Nonoperating income (expense):Interest income
    
    $
    9
    
    
    $
    13
    
    
    
    (30.9
    )Interest expense, net
    
    
    (168
    )
    
    
    (148
    )
    
    
    13.5Other, net
    
    
    33
    
    
    
    (7
    )
    
    
    nmTotal nonoperating expense, net
    
    $
    (126
    )
    
    $
    (142
    )
    
    
    (11.1
    )
    37




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##### Table of Contents



US Airways Results of Operations
  
    
    $9 million of net special credits, consisting of a $16 million refund of
ASIF paid to the TSA during the years 2005 to 2009, offset by other net special charges of
$7 million, which included a settlement and corporate transaction costs; and
 
    
    $4 million of net realized gains related to sales of certain investments in
auction rate securities, included in nonoperating expense, net.
  
    
    $156 million of net unrealized gains resulting from the application of
mark-to-market accounting for changes in the fair value of fuel
hedging instruments. These unrealized
gains were due primarily to the reversal of unrealized losses recognized in prior periods as
hedge transactions settled in the 2009 period;
 
    
    $1 million of net special charges for aircraft costs as a result of capacity
reductions; and
 
    
    a $2 million non-cash asset impairment charge, included in nonoperating expense,
net.
  
    
    $4 million of net special credits, consisting of a $16 million refund of ASIF
paid to the TSA during the years 2005 to 2009, offset by other net special charges of $7
million, which included a settlement and corporate transaction costs and $5 million in
aircraft costs as a result of previously announced capacity reductions; and
 
    
    $53 million of net realized gains related to sales of certain investments in
auction rate securities, included in nonoperating expense, net.
  
    
    $327 million of net unrealized gains resulting from the application of mark-to-market
accounting for changes in the fair value of fuel hedging instruments;
 
    
    $7 million of net special charges, consisting of $6 million in aircraft costs
and $1 million in severance charges, both as a result of capacity reductions; and
 
    
    $7 million in other-than-temporary non-cash impairment charges for investments
in auction rate securities as well as a $2 million non-cash asset impairment charge, all
included in nonoperating expense, net.
    38




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##### Table of Contents



Three Months Ended
    
    
    Percent
    
    
    Six Months Ended
    
    
    PercentJune 30,
    
    
    Change
    
    
    June 30,
    
    
    Change2010
    
    
    2009
    
    
    2010-2009
    
    
    2010
    
    
    2009
    
    
    2010-2009MainlineRevenue passenger miles (millions) (a)
    
    
    15,530
    
    
    
    15,526
    
    
    
    
    
    
    
    28,583
    
    
    
    28,834
    
    
    
    (0.9
    )Available seat miles (millions) (b)
    
    
    18,440
    
    
    
    18,310
    
    
    
    0.7
    
    
    
    35,019
    
    
    
    35,289
    
    
    
    (0.8
    )Passenger load factor (percent) (c)
    
    
    84.2
    
    
    
    84.8
    
    
    
    (0.6
    ) pts
    
    
    81.6
    
    
    
    81.7
    
    
    
    (0.1
    ) ptsYield (cents) (d)
    
    
    13.11
    
    
    
    11.11
    
    
    
    18.1
    
    
    
    13.07
    
    
    
    11.57
    
    
    
    13.0Passenger revenue per available seat mile (cents) (e)
    
    
    11.04
    
    
    
    9.42
    
    
    
    17.3
    
    
    
    10.66
    
    
    
    9.45
    
    
    
    12.8Aircraft at end of period
    
    
    345
    
    
    
    350
    
    
    
    (1.4
    )
    
    
    345
    
    
    
    350
    
    
    
    (1.4
    )Fuel consumption (gallons in millions)
    
    
    276
    
    
    
    278
    
    
    
    (0.6
    )
    
    
    523
    
    
    
    536
    
    
    
    (2.4
    )Average aircraft fuel price including related taxes (dollars per gallon)
    
    
    2.23
    
    
    
    1.58
    
    
    
    40.8
    
    
    
    2.20
    
    
    
    1.53
    
    
    
    44.0Express (f)Revenue passenger miles (millions) (a)
    
    
    2,777
    
    
    
    2,809
    
    
    
    (1.1
    )
    
    
    5,047
    
    
    
    5,183
    
    
    
    (2.6
    )Available seat miles (millions) (b)
    
    
    3,630
    
    
    
    3,676
    
    
    
    (1.3
    )
    
    
    6,909
    
    
    
    7,132
    
    
    
    (3.1
    )Passenger load factor (percent) (c)
    
    
    76.5
    
    
    
    76.4
    
    
    
    0.1
    pts
    
    
    73.0
    
    
    
    72.7
    
    
    
    0.3
    ptsYield (cents) (d)
    
    
    27.60
    
    
    
    22.87
    
    
    
    20.7
    
    
    
    27.10
    
    
    
    23.03
    
    
    
    17.7Passenger revenue per available seat mile (cents) (e)
    
    
    21.12
    
    
    
    17.47
    
    
    
    20.9
    
    
    
    19.80
    
    
    
    16.74
    
    
    
    18.3Aircraft at end of period
    
    
    282
    
    
    
    290
    
    
    
    (2.8
    )
    
    
    282
    
    
    
    290
    
    
    
    (2.8
    )Fuel consumption (gallons in millions)
    
    
    86
    
    
    
    87
    
    
    
    (1.1
    )
    
    
    163
    
    
    
    168
    
    
    
    (3.0
    )Average aircraft fuel price including related taxes (dollars per gallon)
    
    
    2.29
    
    
    
    1.67
    
    
    
    36.8
    
    
    
    2.25
    
    
    
    1.59
    
    
    
    41.1Total Mainline and ExpressRevenue passenger miles (millions) (a)
    
    
    18,307
    
    
    
    18,335
    
    
    
    (0.1
    )
    
    
    33,630
    
    
    
    34,017
    
    
    
    (1.1
    )Available seat miles (millions) (b)
    
    
    22,070
    
    
    
    21,986
    
    
    
    0.4
    
    
    
    41,928
    
    
    
    42,421
    
    
    
    (1.2
    )Passenger load factor (percent) (c)
    
    
    82.9
    
    
    
    83.4
    
    
    
    (0.5
    ) pts
    
    
    80.2
    
    
    
    80.2
    
    
    
    
    ptsYield (cents) (d)
    
    
    15.31
    
    
    
    12.91
    
    
    
    18.6
    
    
    
    15.17
    
    
    
    13.31
    
    
    
    14.0Passenger revenue per available seat mile (cents) (e)
    
    
    12.70
    
    
    
    10.76
    
    
    
    18.0
    
    
    
    12.17
    
    
    
    10.68
    
    
    
    14.0Total revenue per available seat mile (cents) (g)
    
    
    14.54
    
    
    
    12.26
    
    
    
    18.6
    
    
    
    14.06
    
    
    
    12.23
    
    
    
    14.9Aircraft at end of period
    
    
    627
    
    
    
    640
    
    
    
    (2.0
    )
    
    
    627
    
    
    
    640
    
    
    
    (2.0
    )Fuel consumption (gallons in millions)
    
    
    362
    
    
    
    365
    
    
    
    (0.7
    )
    
    
    686
    
    
    
    704
    
    
    
    (2.5
    )Average aircraft fuel price including related taxes (dollars per gallon)
    
    
    2.24
    
    
    
    1.60
    
    
    
    39.8
    
    
    
    2.21
    
    
    
    1.54
    
    
    
    43.3
 
 (a)
    
    Revenue passenger mile (RPM)  A basic measure of sales volume. One RPM represents one
passenger flown one mile.(b)
    
    Available seat mile (ASM)  A basic measure of production. One ASM represents one seat
flown one mile.(c)
    
    Passenger load factor  The percentage of available seats that are filled with revenue
passengers.(d)
    
    Yield  A measure of airline revenue derived by dividing passenger revenue by RPMs and
expressed in cents per mile.(e)
    
    Passenger revenue per available seat mile (PRASM)  Passenger revenues divided by ASMs.(f)
    
    Express statistics include Piedmont and PSA, as well as operating and financial results from
capacity purchase agreements with Air Wisconsin Airlines Corporation, Republic Airways, Mesa
Airlines, Inc. and Chautauqua Airlines, Inc.(g)
    
    Total revenue per available seat mile (RASM)  Total revenues divided by total mainline and
Express ASMs.  39




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##### Table of Contents



Three Months Ended June 30, 2010
Compared with the
Three Months Ended June 30, 2009
 Operating Revenues:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating revenues:Mainline passenger
    
    $
    2,036
    
    
    $
    1,724
    
    
    
    18.1Express passenger
    
    
    767
    
    
    
    642
    
    
    
    19.3Cargo
    
    
    37
    
    
    
    20
    
    
    
    82.1Other
    
    
    369
    
    
    
    310
    
    
    
    19.3Total operating revenues
    
    $
    3,209
    
    
    $
    2,696
    
    
    
    19.0
  
    
    Mainline passenger revenues were $2.04 billion in the second quarter of 2010 as
compared to $1.72 billion in the 2009 period. Mainline RPMs were flat as mainline capacity,
as measured by ASMs, increased 0.7%, resulting in a 0.6 point decrease in load factor to
84.2%. Mainline passenger yield increased 18.1% to 13.11 cents in the second quarter of 2010
from 11.11 cents in the 2009 period. Mainline PRASM increased 17.3% to 11.04 cents in the
second quarter of 2010 from 9.42 cents in the 2009 period. These increases in mainline yield
and PRASM were due principally to an improved pricing environment driven by the recovering
economy, rebound of business travel and continued industry capacity discipline.
 
    
    Express passenger revenues were $767 million in the second quarter of 2010, an
increase of $125 million from the 2009 period. Express RPMs decreased 1.1% as Express
capacity, as measured by ASMs, decreased 1.3%, resulting in a 0.1 point increase in load
factor to 76.5%. Express passenger yield increased by 20.7% to 27.6 cents in the second
quarter of 2010 from 22.87 cents in the 2009 period. Express PRASM increased 20.9% to 21.12
cents in the second quarter of 2010 from 17.47 cents in the 2009 period. The increases in
Express yield and PRASM were the result of the same improved pricing environment discussed in
mainline passenger revenues above.
 
    
    Cargo revenues were $37 million in the second quarter of 2010, an increase of
$17 million, or 82.1%, from the 2009 period. The increase in cargo revenues was driven
primarily by an increase in freight volume as a result of the recovering economic environment
in the 2010 period.
 
    
    Other revenues were $369 million in the second quarter of 2010, an increase of
$59 million, or 19.3%, from the 2009 period, primarily due to an increase in revenue
generated by checked bag fees as a result of increases in rates charged. An increase in
revenues associated with US Airways frequent traveler program also contributed to the
increase in other revenues.
  40




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##### Table of Contents



Operating Expenses:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating expenses:Aircraft fuel and related taxes
    
    $
    616
    
    
    $
    440
    
    
    
    39.9Loss (gain) on fuel hedging instruments, net:Realized
    
    
    
    
    
    
    135
    
    
    nmUnrealized
    
    
    
    
    
    
    (156
    )
    
    nmSalaries and related costs
    
    
    573
    
    
    
    549
    
    
    
    4.3Aircraft rent
    
    
    169
    
    
    
    174
    
    
    
    (3.0
    )Aircraft maintenance
    
    
    162
    
    
    
    184
    
    
    
    (12.0
    )Other rent and landing fees
    
    
    135
    
    
    
    142
    
    
    
    (5.1
    )Selling expenses
    
    
    107
    
    
    
    99
    
    
    
    7.7Special items, net
    
    
    (9
    )
    
    
    1
    
    
    nmDepreciation and amortization
    
    
    65
    
    
    
    64
    
    
    
    2.1Other
    
    
    308
    
    
    
    287
    
    
    
    6.8Total mainline operating expenses
    
    
    2,126
    
    
    
    1,919
    
    
    
    10.7Express expenses:Fuel
    
    
    196
    
    
    
    145
    
    
    
    35.2Other
    
    
    525
    
    
    
    511
    
    
    
    2.8Total Express expenses
    
    
    721
    
    
    
    656
    
    
    
    10.0Total operating expenses
    
    $
    2,847
    
    
    $
    2,575
    
    
    
    10.5
    
    
    Aircraft fuel and related taxes increased 39.9% primarily due to a 40.8% increase in the
average price per gallon of fuel to $2.23 in the second quarter of 2010 from $1.58 in the
2009 period.
 
    
    Since the third quarter of 2008, US Airways has not entered into any new fuel hedging
transactions, and US Airways has not had any fuel hedging contracts outstanding since the
third quarter of 2009. US Airways recognized a net gain of $21 million in the second quarter
of 2009 related to fuel hedging instruments.
 
    
    Salaries and related costs increased 4.3% primarily due to the accrual of $18 million for profit sharing.
 
    
    Aircraft maintenance expense decreased 12% due principally to a decrease in the number of
engine overhauls performed in the 2010 period as compared to the 2009 period as a result of
the timing of maintenance cycles.
 
    
    Selling expenses increased 7.7% due to higher credit card fees and commissions paid as a
result of the 18.1% increase in passenger revenues driven by the improved pricing environment
in the 2010 period.
 
    
    Other expense increased 6.8% due to higher costs associated with US Airways frequent
traveler program, principally an increase in the incremental cost of providing
transportation for travel awards as a result of higher fuel costs in the 2010 period.
  41




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##### Table of Contents



Nonoperating Income (Expense):
 Percent2010
    
    
    2009
    
    
    Change(In millions)Nonoperating income (expense):Interest income
    
    $
    3
    
    
    $
    6
    
    
    
    (47.5
    )Interest expense, net
    
    
    (62
    )
    
    
    (64
    )
    
    
    (3.4
    )Other, net
    
    
    (8
    )
    
    
    6
    
    
    nmTotal nonoperating expense, net
    
    $
    (67
    )
    
    $
    (52
    )
    
    
    29.7
    42




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##### Table of Contents



Six Months Ended June 30, 2010
Compared with the
Six Months Ended June 30, 2009
 Operating Revenues:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating revenues:Mainline passenger
    
    $
    3,735
    
    
    $
    3,335
    
    
    
    12.0Express passenger
    
    
    1,368
    
    
    
    1,194
    
    
    
    14.6Cargo
    
    
    69
    
    
    
    44
    
    
    
    57.7Other
    
    
    721
    
    
    
    614
    
    
    
    17.4Total operating revenues
    
    $
    5,893
    
    
    $
    5,187
    
    
    
    13.6
  
    
    Mainline passenger revenues were $3.74 billion in the first six months of 2010 as compared
to $3.34 billion in the 2009 period. Mainline RPMs decreased 0.9% as mainline capacity, as
measured by ASMs, decreased 0.8%, resulting in a 0.1 point decrease in load factor to 81.6%.
Mainline passenger yield increased 13% to 13.07 cents in the first six months of 2010 from
11.57 cents in the 2009 period. Mainline PRASM increased 12.8% to 10.66 cents in the first
six months of 2010 from 9.45 cents in the 2009 period. These increases in mainline yield and
PRASM were due principally to an improved pricing environment driven by the recovering
economy, rebound of business travel and continued industry capacity discipline.
 
    
    Express passenger revenues were $1.37 billion in the first six months of 2010, an increase
of $174 million from the 2009 period. Express RPMs decreased by 2.6% as Express capacity, as
measured by ASMs, decreased 3.1%, resulting in a 0.3 point increase in load factor to 73%.
Express passenger yield increased by 17.7% to 27.1 cents in the first six months of 2010 from
23.03 cents in the 2009 period. Express PRASM increased 18.3% to 19.8 cents in the first six
months of 2010 from 16.74 cents in the 2009 period. The increases in Express yield and PRASM
were the result of the same improved pricing environment discussed in mainline passenger
revenues above.
 
    
    Cargo revenues were $69 million in the first six months of 2010, an increase of $25
million, or 57.7%, from the 2009 period. The increase in cargo revenues was driven primarily
by an increase in freight volume as a result of the recovering economic environment in the
2010 period.
 
    
    Other revenues were $721 million in the first six months of 2010, an increase of $107
million, or 17.4%, from the 2009 period, primarily due to an increase in revenue generated by
checked bag fees as a result of increases in rates charged. An increase in revenues
associated with US Airways frequent traveler program also contributed to the increase in
other revenues.
  43




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##### Table of Contents



Operating Expenses:
 Percent2010
    
    
    2009
    
    
    Change(In millions)Operating expenses:Aircraft fuel and related taxes
    
    $
    1,151
    
    
    $
    819
    
    
    
    40.5Loss (gain) on fuel hedging instruments, net:Realized
    
    
    
    
    
    
    332
    
    
    nmUnrealized
    
    
    
    
    
    
    (327
    )
    
    nmSalaries and related costs
    
    
    1,128
    
    
    
    1,100
    
    
    
    2.6Aircraft rent
    
    
    340
    
    
    
    352
    
    
    
    (3.4
    )Aircraft maintenance
    
    
    319
    
    
    
    358
    
    
    
    (11.0
    )Other rent and landing fees
    
    
    270
    
    
    
    273
    
    
    
    (1.3
    )Selling expenses
    
    
    201
    
    
    
    192
    
    
    
    5.1Special items, net
    
    
    (4
    )
    
    
    7
    
    
    nmDepreciation and amortization
    
    
    128
    
    
    
    126
    
    
    
    1.8Other
    
    
    612
    
    
    
    573
    
    
    
    6.7Total mainline operating expenses
    
    
    4,145
    
    
    
    3,805
    
    
    
    8.9Express expenses:Fuel
    
    
    366
    
    
    
    267
    
    
    
    36.9Other
    
    
    1,030
    
    
    
    1,020
    
    
    
    1.0Total Express expenses
    
    
    1,396
    
    
    
    1,287
    
    
    
    8.4Total operating expenses
    
    $
    5,541
    
    
    $
    5,092
    
    
    
    8.8
    
    
    Aircraft fuel and related taxes increased 40.5% primarily due to a 44% increase in the
average price per gallon of fuel to $2.20 in the first six months of 2010 from $1.53 in the
2009 period.
 
    
    Since the third quarter of 2008, US Airways has not entered into any new fuel hedging
transactions, and US Airways has not had any fuel hedging contracts outstanding since the
third quarter of 2009. US Airways recognized a net loss of $5 million in the first six
months of 2009 related to fuel hedging instruments.
 
    
    Salaries and related costs
increased 2.6% primarily due to the accrual of $18 million for
profit sharing.
 
    
    Aircraft maintenance expense decreased 11% due principally to a decrease in the number of
engine overhauls performed in the 2010 period as compared to the 2009 period as a result of
the timing of maintenance cycles.
 
    
    Selling expenses increased 5.1% due to higher credit card fees and commissions paid as a
result of the 12% increase in passenger revenues driven by the improved pricing environment
in the 2010 period.
 
    
    Other expense increased 6.7% primarily due to higher costs associated with US Airways
frequent traveler program, principally an increase in the incremental cost of providing
transportation for travel awards as a result of higher fuel costs in the 2010 period. The
negative effects of the severe weather on the East Coast of the United States in the first
quarter of 2010 also contributed to the increase in other expenses.
  44




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##### Table of Contents



Nonoperating Income (Expense):
 Percent2010
    
    
    2009
    
    
    Change(In millions)Nonoperating income (expense):Interest income
    
    $
    9
    
    
    $
    13
    
    
    
    (30.9
    )Interest expense, net
    
    
    (121
    )
    
    
    (125
    )
    
    
    (3.6
    )Other, net
    
    
    32
    
    
    
    (9
    )
    
    nmTotal nonoperating expense, net
    
    $
    (80
    )
    
    $
    (121
    )
    
    
    (34.1
    )
    45




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Liquidity and Capital Resources
  Investments in Marketable Securities
 Current
  Noncurrent
     Sources and Uses of Cash
 US Airways Group
     46




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US Airways
    Commitments
  Citicorp Credit Facility
    47




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7% Senior Convertible Notes
  2010 Financing Transactions
  Credit Card Processing Agreements
  Aircraft and Engine Purchase Commitments
    48




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Increased costs of financing,
a reduction in the availability of financing and fluctuations in interest rates could adversely
affect our liquidity, operating expenses and results Our high level of fixed obligations
limits our ability to fund general corporate requirements and obtain additional financing, limits
our flexibility in responding to competitive developments and increases our vulnerability to
adverse economic and industry conditions.
 Covenants and Credit Rating
 Our high level of fixed obligations limits
our ability to fund general corporate requirements and obtain additional financing, limits our
flexibility in responding to competitive developments and increases our vulnerability to adverse
economic and industry conditions Any failure to comply with the liquidity covenants contained
in our financing arrangements would likely have a material adverse effect on our business,
financial condition and results of operations
  S&P
    
    
    Fitch
    
    
    MoodysLocal Issuer
    
    
    Issuer Default
    
    
    CorporateCredit Rating
    
    
    Credit Rating
    
    
    Family RatingUS Airways Group
    
    B-
    
    CCC
    
    Caa1US Airways
    
    B-
    
    *
    
    *
 (*)
    
    The credit agencies do not rate these categories for US Airways.  Off-Balance Sheet Arrangements
    49




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##### Table of Contents



Contractual Obligations
  Payments Due by Period2010
    
    
    2011
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    Thereafter
    
    
    TotalUS Airways Group (1)Debt (2)
    
    $
    74
    
    
    $
    16
    
    
    $
    116
    
    
    $
    116
    
    
    $
    1,276
    
    
    $
    
    
    
    $
    1,598Interest obligations (3)
    
    
    29
    
    
    
    55
    
    
    
    52
    
    
    
    46
    
    
    
    22
    
    
    
    
    
    
    
    204US Airways (4)Debt and capital lease obligations (5) (6)
    
    
    201
    
    
    
    397
    
    
    
    321
    
    
    
    271
    
    
    
    282
    
    
    
    1,707
    
    
    
    3,179Interest obligations (3) (6)
    
    
    81
    
    
    
    148
    
    
    
    158
    
    
    
    114
    
    
    
    97
    
    
    
    410
    
    
    
    1,008Aircraft purchase and operating lease commitments (7)
    
    
    572
    
    
    
    1,503
    
    
    
    1,446
    
    
    
    1,864
    
    
    
    1,576
    
    
    
    5,771
    
    
    
    12,732Regional capacity purchase agreements (8)
    
    
    501
    
    
    
    1,046
    
    
    
    911
    
    
    
    780
    
    
    
    779
    
    
    
    2,390
    
    
    
    6,407Other US Airways Group subsidiaries (9)
    
    
    6
    
    
    
    9
    
    
    
    9
    
    
    
    7
    
    
    
    6
    
    
    
    1
    
    
    
    38Total
    
    $
    1,464
    
    
    $
    3,174
    
    
    $
    3,013
    
    
    $
    3,198
    
    
    $
    4,038
    
    
    $
    10,279
    
    
    $
    25,166
 
 (1)
    
    These commitments represent those specifically entered into by US Airways Group or joint
commitments entered into by US Airways Group and US Airways under which each entity is jointly
and severally liable.(2)
    
    Excludes $155 million of unamortized debt discount as of June 30, 2010.(3)
    
    For variable-rate debt, future interest obligations are shown above using interest rates in
effect as of June 30, 2010.(4)
    
    Commitments listed separately under US Airways and its wholly owned subsidiaries represent
commitments under agreements entered into separately by those companies.(5)
    
    Excludes $86 million of unamortized debt discount as of June 30, 2010.(6)
    
    Includes $481 million of future principal payments and $200 million of future interest
payments as of June 30, 2010, respectively, related to pass through trust certificates or
EETCs associated with mortgage financings for the purchase of certain aircraft.(7)
    
    Includes $3.1 billion of future minimum lease payments related to EETC leveraged leased
financings of certain aircraft as of June 30, 2010.(8)
    
    Represents minimum payments under capacity purchase agreements with third-party Express
carriers.(9)
    
    Represents operating lease commitments entered into by US Airways Groups other airline
subsidiaries Piedmont and PSA.   50




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Critical Accounting Policies and Estimates
  Recent Accounting Pronouncements
    51




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Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Market Risk Sensitive Instruments
  Commodity price risk
  Interest rate risk
     52




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Item 4. Controls and Procedures
 Evaluation of disclosure controls and procedures.
  Changes in internal control over financial reporting.
  Limitation on the effectiveness of controls.
   53




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Part II. Other Information
 
 Item 1. Legal Proceedings
   
 Item 1A. Risk Factors
  Risk Factors Relating to the Company and Industry Related Risks
 US Airways Group could experience significant operating losses in the future.
  Downturns in economic conditions adversely affect our business.
 The airline industry is intensely competitive and
dynamic
 Increased costs of financing, a reduction in the availability of financing and fluctuations in
interest rates could adversely affect our liquidity, operating expenses and results.
   54




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Quantitative and Qualitative Disclosures About Market Risk
 Our business is dependent on the price and availability of aircraft fuel. Continued periods of
high volatility in fuel costs, increased fuel prices and significant disruptions in the supply of
aircraft fuel could have a significant negative impact on our operating results and liquidity.
    Quantitative and Qualitative Disclosures About Market
Risk
  55




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Our high level of fixed obligations limits our ability to fund general corporate requirements and
obtain additional financing, limits our flexibility in responding to competitive developments and
increases our vulnerability to adverse economic and industry conditions.
   
    
    a decrease in revenues results in a disproportionately greater percentage decrease in
earnings;
 
    
    we may not have sufficient liquidity to fund all of these fixed costs if our revenues
decline or costs increase; and
 
    
    we may have to use our working capital to fund these fixed costs instead of funding
general corporate requirements, including capital expenditures.
  Any failure to comply with the liquidity covenants contained in our financing arrangements would
likely have a material adverse effect on our business, financial condition and results of
operations.
    If our financial condition worsens, provisions in our credit card processing and other commercial
agreements may adversely affect our liquidity.
  Union disputes, employee strikes and other labor-related disruptions may adversely affect our
operations.
    56




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The inability to maintain labor costs at competitive levels would harm our financial performance.
  If we incur problems with any of our third-party regional operators or third-party service
providers, our operations could be adversely affected by a resulting decline in revenue or
negative public perception about our services.
   We rely heavily on automated systems to operate our business and any failure or disruption of
these systems could harm our business.
   57




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Changes to our business model that are designed to increase revenues may not be successful and may
cause operational difficulties or decreased demand.
  The airline industry is intensely competitive and dynamic.
    The loss of key personnel upon whom we depend to operate our business or the inability to attract
additional qualified personnel could adversely affect the results of our operations or our
financial performance.
  We may be adversely affected by conflicts overseas or terrorist attacks; the travel industry
continues to face ongoing security concerns.
   58




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Changes in government regulation could increase our operating costs and limit our ability to
conduct our business.
     Our ability to operate and grow our route network in the future is dependent on the availability
of adequate facilities and infrastructure throughout our system.
  We are subject to many forms of environmental regulation and may incur substantial costs as a
result.
     59




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##### Table of Contents



Ongoing data security compliance requirements could increase our costs, and any significant data
breach could harm our business, financial condition or results of operations.
    Interruptions or disruptions in service at one of our hub airports or our focus city could have a
material adverse impact on our operations.
   60




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##### Table of Contents



We are at risk of losses and adverse publicity stemming from any accident involving any of our
aircraft or the aircraft of our regional operators.
  Delays in scheduled aircraft deliveries or other loss of anticipated fleet capacity may adversely
impact our operations and financial results.
  Our business is subject to weather factors and seasonal variations in airline travel, which cause
our results to fluctuate.
  Increases in insurance costs or reductions in insurance coverage may adversely impact our
operations and financial results.
  We may be adversely affected by global events that affect travel behavior.
  We are exposed to foreign currency exchange rate fluctuations.
   61




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##### Table of Contents



The use of US Airways Groups net operating losses and certain other tax attributes could be
limited in the future.
  Risks Relating to Our Common Stock
 The price of our common stock has recently been and may in the future be volatile.
  
    
    our operating results failing to meet the expectations of securities analysts or
investors;
 
    
    changes in financial estimates or recommendations by securities analysts;
 
    
    material announcements by us or our competitors;
 
    
    movements in fuel prices;
 
    
    new regulatory pronouncements and changes in regulatory guidelines;
 
    
    general and industry-specific economic conditions;
 
    
    public sales of a substantial number of shares of our common stock; and
 
    
    general market conditions.
 Conversion of our convertible notes will dilute the ownership interest of existing stockholders
and could adversely affect the market price of our common stock.
  Certain provisions of the amended and restated certificate of incorporation and amended and
restated bylaws of US Airways Group make it difficult for stockholders to change the composition
of our board of directors and may discourage takeover attempts that some of our stockholders might
consider beneficial.
  
    
    a classified board of directors with three-year staggered terms;
 
    
    advance notice procedures for stockholder proposals to be considered at stockholders
meetings;
 
    
    the ability of US Airways Groups board of directors to fill vacancies on the board;
 
    
    a prohibition against stockholders taking action by written consent;
  62




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##### Table of Contents




    
    a prohibition against stockholders calling special meetings of stockholders;
 
    
    a requirement that holders of at least 80% of the voting power of the shares entitled to
vote in the election of directors approve any amendment of our amended and restated bylaws
submitted to stockholders for approval; and
 
    
    super-majority voting requirements to modify or amend specified provisions of US Airways
Groups amended and restated certificate of incorporation.
  Our charter documents include provisions limiting voting and ownership of our equity interests,
which includes our common stock and our convertible notes, by foreign owners.
   63




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Item 5. Exhibits
 Exhibit No.
    
    Description10.1
    
    
    Amendment No. 7, dated as of April 1, 2010, to the Amended and Restated Airbus A320
Family Aircraft Purchase Agreement, dated as of October 2, 2007, between Airbus S.A.S.
and US Airways, Inc.*31.1
    
    
    Certification of US Airways Groups Chief Executive Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.31.2
    
    
    Certification of US Airways Groups Chief Financial Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.31.3
    
    
    Certification of US Airways Chief Executive Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.31.4
    
    
    Certification of US Airways Chief Financial Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.32.1
    
    
    Certification of US Airways Groups Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of US Airways Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Portions of this exhibit have been omitted under a request for
confidential treatment and filed separately with the United States
Securities and Exchange Commission.  64




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Signatures
  US Airways Group, Inc. (Registrant)Date: July 20, 2010
    By:
    /s/ Derek J. KerrDerek J. KerrExecutive Vice President and
Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)US Airways, Inc. (Registrant)Date: July 20, 2010
    By:
    /s/ Derek J. KerrDerek J. KerrExecutive Vice President and
Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)  65




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##### Table of Contents



Exhibit Index
 Exhibit No.
    
    Description10.1
    
    
    Amendment No. 7, dated as of April 1, 2010, to the Amended and Restated Airbus A320
Family Aircraft Purchase Agreement, dated as of October 2, 2007, between Airbus S.A.S.
and US Airways, Inc.*31.1
    
    
    Certification of US Airways Groups Chief Executive Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.31.2
    
    
    Certification of US Airways Groups Chief Financial Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.31.3
    
    
    Certification of US Airways Chief Executive Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.31.4
    
    
    Certification of US Airways Chief Financial Officer pursuant to Rule
13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended.32.1
    
    
    Certification of US Airways Groups Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of US Airways Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Portions of this exhibit have been omitted under a request for
confidential treatment and filed separately with the United States
Securities and Exchange Commission.  66