America West Airlines' shareholders and employees voiced worries about a potential merger with US Airways on Tuesday, as America West's CEO deflected questions about the possible link-up.
At America West's annual meeting here, held at the airline's headquarters near the Phoenix airport, CEO Doug Parker disappointed many of the 200 workers and shareholders by saying up front that he could shed no new light on merger discussions for legal reasons.
But that didn't stop nearly a dozen people from urging Parker to merge the companies in a way that protects jobs, especially America West jobs. In the airline industry, seniority rules, and America West workers know they have much less than US Airways workers.
Gate agent Deborah Ewing told Parker she worried that she would lose her job if the two carriers combined, because US Airways' workers tend to have more seniority -- a key determinant of who stays and who goes when unions are merged.
"If you really care about the employees and the job that we're doing, then you will pay attention to that and factor it in so that these people don't come in and take our positions," she said.
Tuesday's meeting was the most prominent display of discontent about an America West-US Airways deal since the two sides said they were talking three weeks ago. Despite Tuesday's public silence, many employees and analysts expect an announcement of a deal this week.
Such a merger could create a national low-cost, low-fare airline that flies from hubs on two coasts. Arlington, Va.-based US Airways would contribute its East Coast-heavy network, with hubs in Charlotte and Philadelphia, and America West would provide its Las Vegas and Phoenix hubs. The combined airline, with the low pay scales both airlines won during trips to bankruptcy court, may better compete with Southwest and the other low-cost carriers dominating the market.
A merger would also have huge implications for Charlotte, US Airways' biggest hub and home to about 5,600 of the airline's 25,000 workers. Charlotte also has nearly twice as many daily flights, 577, as America West's largest hub, Phoenix.
This week, reports surfaced that as much as $1 billion in financing from a variety of companies appears to be forthcoming to fund a deal. That money would be needed because neither carrier has the financial muscle to pull off a combination on their own.
A potential deal is also big news in the Phoenix area, where about 9,900 of America West's 14,000 employees are based. Many assume a combined company would be headquartered in Arizona, in part because Parker, 43, is seen as the most likely to run the airline.
Some analysts speculate the two could create a holding company, with the carriers operating as separate units for a few years before fully integrating.
That blending process is what worries some America West workers. In the airline industry, a worker's number of years of service determines everything from pay to work schedules to where he or she is based.
US Airways, because it is an older airline and because it has laid off many of its junior workers, is dominated by veterans: Its most junior pilot was hired in 1988. America West's most senior worker was hired in 1983, when the airline was born.
Pilots and flight attendants at the two airlines share the same unions, which should ease the integration process. According to those unions' by-laws, seniority depends solely on date of hire.
Other work groups -- including mechanics, gate agents, baggage handlers -- would need to elect new representation after a merger, as they each have different unions representing them.
Any deal would require approval from shareholders, a bankruptcy judge, a federal loan board and antitrust regulators.
Some at the annual meeting Tuesday said they still need to be convinced a merger makes sense.
"I don't want to see the economics of the company stretched to an extent in taking on US Airways that it puts the whole company in jeopardy," said Christopher Miller, 42, an investment banker who owns about 10,000 shares, in an interview.
America West Holdings Corp. said nearly 96 percent of the total voting shares favored the deal.
US Airways has benefited from its willingness to adopt some elements of the low-cost-carrier template and abandon others.