Struggling US Airways has officially joined the Star Alliance network.
The Arlington, Va.-based carrier is hoping the long-awaited tie-up will add needed dollars to its bottom line. In the past, airlines that have joined global alliances have seen increased passenger loads and income, largely due to joint marketing agreements, reciprocal frequent flyer benefits and codesharing.
“Experience has shown that US Airways and other member carriers will see an increase in traffic and revenue as more frequent fliers take advantage of the vast array of benefits the Star Alliance network has to offer,” said Jaan Albrecht, CEO of Star Alliance.
Dividend Miles members are now able to accrue and redeem miles on any of the 15 member airlines (Air Canada, Air New Zealand, ANA, Asiana Airlines, Austrian, bmi, LOT Polish Airlines, Lufthansa, Scandinavian Airlines, Singapore Airlines, Spanair, Thai Airways International, United, US Airways and VARIG) and are eligible to achieve Star Alliance Silver or Star Alliance Gold status.
Chairman’s Preferred and Gold Preferred members automatically become Star Gold members, and Silver Preferred members are recognized as Star Silver members.
Alliance membership will need to pay dividends quickly if US Airways, which pulled out of Chapter 11 in March of 2003, is to avoid a second round of bankruptcy. Recent personnel changes indicate tension within the ranks. In April, CEO David Siegel abruptly resigned after contentious relations with unions and was replaced by Bruce Lakefield. In May, Dave Davis replaced CFO Neal Cohen.
A number of cost-cutting measures are set to be implemented this summer, including the replacement of some 200 gate agents with automated machines.
In a filing with the Securities and Exchange Commission, US Airways officials said a failure to achieve the cuts “would force the carrier to re-examine its strategic options, including but not limited to asset sales or a judicial restructuring.”
For the moment, though, the Dividend Miles program is steaming ahead. To mark its new membership in the Star Alliance, Dividend Miles is offering a “Round-the-World Sweepstakes” with chances to win award tickets, including a Grand Prize of two first-class award tickets around the world. Over 50 tickets valid on the Star Alliance member airlines are being given away. No purchase is necessary to enter.
In addition, Dividend Miles members have the opportunity to earn bonus miles when registering for offers from Asiana, Austrian, bmi, Singapore, THAI, United and VARIG. Offers vary by airline. Members must register for each offer before departure. Details about the bonuses and the sweepstakes can be found online at http://www.usairways.com.