US Airways, America West Ready to Merge

In a move to compete with low-cost carriers, US Airways Group Inc. and America West Holdings Corp., the nation´s seventh and eighth largest carriers, respectively, announced a plan to enter into a merger.

America West and US Airways are to form a new airline that will provide customers the full-service offering and reach of a legacy airline with the consumer-friendly pricing structure of a low fare carrier.

The combined company will fly as US Airways and would become the nation´s sixth largest airline in terms of passenger miles, an industry measurement.

US Airways, which last year filed for bankruptcy protection for the second time in two years, had cut worker pay by $1 billion a year and scrapped $3 billion in pension obligations.

The new US Airways will be based in Tempe, Arizona, where America West is now headquartered.