The History of America West
Unofficial History of America West
This history is unofficial. It is not written or sanctioned by America West Holdings, Inc, US Airways Group, America West Airlines, or US Airways. It is written by enthusiasts for enthusiasts.
On August 1, 1983, a small airline with three planes flew their first flight, flight 105 from Kansas City - Colorado Springs - Phoenix. It was the first flight of America West Airlines, an airline born of optimism that would survive many near-death calls to become the 8th largest airline in the United States.
This is a story of an airline written off many times for dead. A story of a survivor. A story of an airline linked with their home base, Phoenix.
Ed Beauvais, CEO, founded the company that would become America West on September 4, 1981. He recruited various people to start the airline, including Mike Conway, who would become the airline's president. 1981 was not a good time to be in the industry, with high inflation, a poor economy, and a glut of failing startup airlines.
The tenacity of the management team was proven when February 1983 rolled around. Financing finally became available for startup airlines, partially due to the success of PEOPLExpress, and $18.75 million was raised through an Initial Public Offering.
A combination of ideas were used in the formation of America West. Cross-utilization of employees, brought to new extremes by PEOPLExpress, would be a major feature of America West. Pilots would also work dispatch, while Customer Service Representatives (CSR) would work as flight attendants, ramp agents, gate agents, ticket agents, or reservation agents - depending on the day. Unlike PEOPLExpress, though, America West was a full service airline, with free cocktails, free newspapers, king-sized overhead bins, and assigned seating.
June 20, 1983, brought the first airplane, N126AW. Two other 737-200 aircraft were delivered in time for the August 1, 1983 inaugural. The staff gathered for several pictures in front of the first aircraft, as well as at Gate 1 before the first Phoenix departure. Aside from the three gates and operational areas, there were no other facilities at Phoenix.
In America West Magazine from August 1993, Randy Lenton recalled some of the features of those days. "We used to wash the aircraft at night with a garden hose…[and] only had tiny areas for Dispatch, Commisary, and Maintenance. We had no hangar - other than the 'Blue Sky Hangar,' our name for the great outdoors - and we did all of our maintenance on the ramp. We were growing, and the facilities weren't growing fast enough to keep up."
The magazine also highlighted memories of the early days. Before formal training facilities were built, in-flight training was done in a room with folding chairs set up as an airplane.
Another feature of America West, borrowed from PEOPLExpress and PSA, was on-board ticketing. Passengers could buy tickets before their flight, or onboard. Gate desks were replaced with a large, circular counter, called the "Seat Assignment Center" - but quickly nicknamed the Queen Mary. While on-board ticketing was a good idea at the time, it led to more problems - such as breaking change, or balancing out the tickets. On-board ticketing survived a year, before being replaced with a traditional ticketing system.
The airline grew to 11 aircraft and 13 cities by the end of 1983, an impressive growth rate for any airline. Part of Beauvais' strategy was to gain critical mass, a growth strategy shared by many other airlines at the time. By the end of 1984, a traditional ticketing and computer system was put into place (SHARES, or System One) and on-board ticketing was put to an end - all while the airline grew to 23 cities (three were dropped in October) and 21 aircraft (3 737-100, 18 737-200 aircraft.) Terminal 3 was steadily expanded to nine gates in the south concourse - however, these gates could not open quickly enough to meet growth, forcing some planes to park at the old Hughes Airwest rotunda at Terminal 2.
Phoenix was an interesting market in the early days of America West. Dominated by TWA and Hughes Airwest during regulation, by 1983 Republic was the sole dominant carrier. Republic cut back service at Phoenix drastically in 1984, with a total revision of their route structure, making additional room for America West's growth (as well as Southwest).
The early years were a time of high enthusiasm and energy for the small airline. Mass hirings brought thousands of people applying for a few positions. Employees were also owners - each employee, unless state law prevented it, was required to purchase stock in America West when they were hired, usually 20% of their first year's salary. Many employees took loans from the company to purchase their required stock, and these loans were repaid through payroll deductions - an unusual way to fund growth.
In December 1984, the airline received an unsolicited takeover offer. Rumors pegged it to Southwest, but neither Southwest or America West would confirm or deny this rumor. The offer was rejected by the board of directors shortly after receipt.
Due to the rapid growth, extra gates were required for the Phoenix hub. A temporary concourse was built west of the existing Terminal 3 gates, between Terminals 2 and 3. Opening in mid-1985, it provided six new gates for the operation. This concourse was later expanded to ten gates by adding a two level extension on the end in 1987. "More Care Car Service" was added between the two concourses to assist passenger connections. An alliance was signed with Northwest Airlines, making America West an independent Airlink carrier, similar to PSA and Horizon elsewhere on the west coast. Northwest and America West aligned their schedules, allowing easier passenger connections until the agreement was ended in October 1986.
By 1985, the airline would expand their product base, adding cargo service and the first new aircraft - a pair of 737-3G7 aircraft (N150AW, N151AW) ordered in 1983. Service expanded to 25 cities as frequencies were added in the system between existing destinations. 1985 was the first profitable year for the nascent airline, allowing more growth in 1986, including new 'Nite Flight' service based out of Las Vegas and construction of a hangar at Phoenix to support maintenance.
Nite Flights were designed to increase utilization of the fleet while aircraft were otherwise idle. Flights would depart field stations late in the day, usually between 8 and 9 PM, arrive in Las Vegas, then continue out to other field stations around Midnight. Las Vegas was the perfect base for this operation, being a 24-hour city. These flights were also incredibly popular for time-sensitive freight, allowing even lower passenger fares than the rest of the system.
On the people side, America West started a 24-hour child care program for all employees in 1986, as well as a free shuttle service to Scottsdale. Named "The Careliner Shuttle", service was offered every half hour between Scottsdale and Sky Harbor, free with any ticket ($15 without an America West ticket.) This service was another innovative feature of America West, designed to easily link the resort and business area of Scottsdale to Sky Harbor while allowing passengers to avoid the drive. Service to Mesa would be added in 1987.
Child Care brought America West numerous awards. The airline was one of the first companies to offer not only on-site child care, but also in-home child care, 24 hours a day. Conway designed the program to meet the needs of the fully cross-utilized CSRs in Phoenix, who were still flying one day and working the airport the next.
While maintaining an all 737 fleet in 1986 (737-100, -200, and -300), an opportunity became available. Republic was bought by Northwest, making their almost-new dual class 757 aircraft redundant. America West was offered the six 757-2S7 aircraft, and snapped them up to start new service. The first aircraft were delivered on May 11, 1987, in time to start Phoenix-O'Hare service on May 20. New York (Kennedy) and Baltimore followed on July 1. Trying to increase feed to the Phoenix hub, three DeHavilland Dash 8-200 aircraft were delivered, and placed into service on routes to Yuma, Grand Canyon, and Flagstaff.
More cash was needed in 1987, as well as aircraft. America West inked a deal with Ansett Worldwide, where Ansett purchased 20% of AWA stock and leased several aircraft to the airline. The aircraft were built to America West standards, but owned by Ansett. Some 737-300 aircraft were outfitted for long-haul service, with the same entertainment systems used on the 757 and a first-class cabin.
On the revenue side, AmeriWest vacations started in 1987. This division offered tour packages, primarily to Las Vegas, and fill up otherwise empty seats. AmeriWest vacations would drive an impressive revenue gain for the company, and at times it was the only profitable division of the company. Reno reservations opened in 1987 to support the traffic growth. The first Phoenix Club opened in September at Terminal 3, in an addition to the end of the temporary concourse designed to support the new 757 fleet.
FlightFUND, the frequent flyer program, started on June 10, 1987. The program, replacing America West's previous (and little-known) "Free Flight Plan", awarded passengers dollars based on fares paid, rather than miles flown. These 'dollars' could then be spent on rewards, including a cruise on the Queen Elizabeth 2.
"Fast Check", another innovation, was added in 1987. A check-in location was placed on Sky Harbor's lot 'D' (where Terminal 4 currently sits), and passengers could check baggage and ship cargo from this remote location without leaving their car, then take a shuttle to Terminal 3. Fast Check was an employee suggestion, designed to reduce pressure on the ticket counter in now-constrained Terminal 3. Fast Check would be relocated through the years, ending up in both west and east remote lots by 1990.
Rapid growth put tremendous financial strain on the operation, and America West ended the year with a $45.6 million loss, and only $26 million cash on hand. Bankruptcy predictions were imminent, despite management's opinion that the losses were needed to ensure America West's future. Beauvais and Conway responded by cutting back growth and a much-touted "return to profitability" in 1988. The airline made one major commitment to Phoenix, signing a lease for the new Terminal 4, soon to rise out of the sands of Sky Harbor.
Terminal 4 would offer valet parking, increased operational room, and 28 gates dedicated to America West. Two Phoenix Clubs were included, one on the mezzanine of each concourse. A dedicated commuter gate was included, replacing the converted facilities of Gate 30. Pride was running high with the new terminal, growing fleet, and new wide-body aircraft on order. To assist with the growth of the hub, a new baggage sorting facility was built rampside between the two concourses of Terminal 3. It featured a $2.3 million laser sorting system for originating bags, 12 loading piers, and a large increase in capacity from the original Terminal 3 bagroom. A Phoenix Club would be built atop this room in 1989.
Commuter service continued to grow during this time, with a steady increase in the Dash 8 fleet and service to mid-level California destinations from both Phoenix and Las Vegas. In some cases, the commuter service was added to Las Vegas only, making Las Vegas almost equal to Phoenix in terms of hub operation.
America West started to participate in industry consolidation during 1988. The airline filed a formal complaint against the USAir/Piedmont merger, but this complaint was dismissed due to lack of standing. The airline then put a bid in for the Eastern Shuttle - $726 million for 10 757s and 21 727 aircraft. America West would end up losing to Donald Trump in the convoluted tale of Eastern.
Returning to 1988, Minneapolis was added from Las Vegas. Northwest was still maintaining the 757 fleet, and MSP was added as a Nite Flight to turn a non-revenue ferry into a revenue operation. With the opening of the Hangar, America West brought all 737 maintenance in-house, and started pursuing contract maintenance work.
During 1988, America West Captain Pat Lynch founded Operation Freedom Bird, a program designed to transport Vietnam Veterans to Washington to see the Vietnam Memorial, discuss any unresolved issues and participate in Veterans Day ceremonies. America West was the primary sponsor of this program until the late 1990s, and provided the transportation for Veterans to get to Washington.
The shocker of the year was America West's announced purchase of two 747 aircraft, and a route application for Sydney service. Sydney would be denied, but Honolulu would still be added with the new (used) aircraft.
The much-touted Bird of Paradise wide-body service started on November 15, 1989, with 747-206Bs purchased from KLM. Non-stop flights to Honolulu were operated from both hubs, with the aircraft continuing between Phoenix and Las Vegas. America West completed the 747 introduction program in approximately six months, and ordered two 747-4G7 aircraft for additional long-haul growth. FlightFUND was converted to a mileage-based frequent flyer program, offering 750 miles minimum for any America West flight, and a free flight after 20,000 miles. A marketing agreement was signed with the Phoenix Suns basketball team, making their new home in downtown Phoenix the America West Arena.
In September 1989, America West took over security screening in Terminal 3, using company security officers. The Phoenix hub was rescheduled at this time, from a rolling hub (8-10 planes on the ground at once) to a directional hub, reducing connection time and making the hub more competitive.
As part of the Eastern strike, America West picked up temporary slots at Washington National and New York LaGuardia. Service began rapidly, allowing America West's entry into the lucrative DCA market.
Then 1990 rolled around. It started out well, but by the end of the year, things were rapidly unraveling.
AWA took delivery of two more 747-206B aircraft in 1990, but had not received the rights to fly further in the Pacific. To keep the aircraft in use, they were placed into New York Kennedy, with one flight to Las Vegas and one to Phoenix. This move forced a terminal change at New York Kennedy, with America West ending up in the unused Eastern terminal. The equipment available at the Eastern terminal was so poorly maintained, America West needed to buy new loading bridges for their gates. The 747 service to New York Kennedy lasted until the end of 1990.
A new Phoenix Club opened in Orange County in 1990 - the first non-hub Phoenix Club. Additional Clubs were planned for Las Vegas, Honolulu, and New York Kennedy. Careliner service only went to Scottsdale (Mesa ended in 1988), but plans were in the works to add Careliner service to Scottsdale's new Galleria and America West Arena. Despite the slowdown in the economy, America West was still operating full steam ahead, participating in a work exchange program with Ansett. During October and November, Ansett and America West in-flight CSRs traded places, working in their own uniforms on the other's airline.
November 11, 1990 brought the opening of Terminal 4. The new showpiece of the system featured 27 jet gates, one commuter gate, a ramp control tower, four levels of parking, check-in facilities on every level of the garage next to the elevators, and valet parking. The celebrations included a full open house with both historic aircraft and America West aircraft. An $18 million laser baggage system was installed in the terminal as well. Unlike the Terminal 3 system, this one was designed to serve the concourses as well, with piers located below the gates in each concourse. Default and induction piers were located on both concourses, and all luggage was supposed to be sorted by the system.
November also saw delivery of America West's first Airbus A320 aircraft. Airbus had 17 aircraft originally ordered by Braniff (II), however, Braniff only ever operated two before going bankrupt. America West negotiated an attractive package of financing, including $140 million in introductory cash support and $80 million in non-cash support. The original order was for up to 118 A320 aircraft, which was in addition to 53 Boeing aircraft on order. On the employee side, a unique partnership with Rio Salado Community College was established in March, offering college credit for America West training classes. This program continues today, allowing front-line workers to earn an Associate degree through the company.
Desperately trying to keep passengers flying, in spite of the instability in the Persian Gulf, America West offered a fare sale on December 8, 1990. "The Sale" offered 50% off any ticket, or 2-for-1 gift certificates and value packs. People flocked to the Phoenix-only sale, giving a tremendous boost in public relations but without a corresponding increase in revenue. In Phoenix, all three terminal garages were filled up with America West passengers buying tickets, and the airline ran out of ticket stock. Beauvais and Conway tried to put a positive spin on this in the 1990 annual report, saying that the effect of the sale would be minimized by spreading the tickets out over the entire year.
America West managed to stave off bankruptcy in 1990, but 1991 would not be so kind. Beauvais, continuing the Asian strategy, pursued a route application to Tokyo which was not approved. Honolulu was designated a hub, and the Bird of Paradise service was instead extended to Nagoya on February 27. Nagoya, instead of leading passengers into the "Heart of Japan", would prove to be the breaking point for America West. The route proved to be a money-loser, with the first flight carrying one passenger to Nagoya, leading to an almost immediate service reduction to three weekly flights (from daily).
A three-day nationwide 50% sale was initiated on February 6, corresponding with the introduction of A320 service (Phoenix-Chicago O'Hare) and growth in the California Corridor (Los Angeles to the Bay Area). In April, taking advantage of USAir's abandonment of the West Coast routes acquired through PSA, America West increased intra-California service from Long Beach and Orange County. Orange County also earned a non-stop route to JFK, complimenting the focus on the airport established with the new terminal. With traffic down due to the Gulf War, most of the intra-California routes would be short-lived, except the monopoly Santa Ana/Orange County to Sacramento route. The renamed America West Vacations division added Arizona vacations, complimenting their focus on Nevada (the largest tour wholesaler) and Hawaii (as the second-largest tour wholesaler).
The house of cards was about to collapse. On top of high oil prices, high fuel consumption on the 747, low yields, a high debt load, and no improvement in sight, the airline filed for bankruptcy on June 27.
The signs had been obvious. Pay and hiring freezes were first established, followed by a 10% pay cut for all employees, and the elimination of free cocktails, newspapers, and free flights for employees. Service to 10 cities had been cut before the filing. Morale came crashing down, as high-flying America West, the darling of deregulation, fell to earth. Bankruptcy would prove to be a long, turbulent process, costing Beauvais and Conway their leadership roles in the airline, as well as all employee-owned stock. Many employees found themselves in the unenviable position of having to pay back loans on worthless stock to the company if they left.
The first major cutback occurred in September, when the fleet was reduced to 103 aircraft (from 126). Debtor In Possession (DIP) financing was obtained from lessors G.P.A. and Kawasaki, in return for Airbus 320 lease options. Northwest Airlines also contributed $15 million in financing, secured by the Honolulu-Nagoya route authority.
Beauvais was removed from day-to-day operating affairs as part of the DIP package, but remained Chairman of the Board while Conway assumed the role of CEO in the first of many power struggles. One of Conway's first moves was to attempt to attract high-yield Fortune 100 traffic, which was the rationale for opening a new hub in Columbus, Ohio on December 15. Contrary to popular belief, it was not because Bank One (Columbus-based) contributed money to the struggling airline - Bank One did not contribute any money to the airline until 1992. The Baltimore reservations center was moved to Kansas City as well.
Four new cities were added in the first half of 1992, including Mexico City on June 1. America West resumed their international service with this route. Northwest's financing was repaid with the sale of Nagoya rights to Northwest for $15 million. However, America West's cash burn rate had not improved, and more money was needed. Shutdown was imminent when the September 1992 DIP package arrived, with financing from Ansett and a consortium of Phoenix-based companies. This final, small package ($8 million) would lead to the most drastic changes in the airline during bankruptcy; changes that would alter the course of the airline forever.
Arizona governor Fife Symington started a business roundtable, and asked William A. Franke to chair the roundtable. Franke was a prominent Phoenix businessman, who had led turnarounds of Phoenix-based Circle K and Valley Independent Bank. His purpose was to raise money from local businesses to support America West, the largest employer in Arizona. Franke successfully raised the money, engineering the ouster of Ed Beauvais to become Chairman of the Board, bringing in five new board members. Other conditions of the package were the reduction of the fleet from five aircraft types to three, reduction of the fleet to 87 aircraft, and restructuring existing aircraft orders.
Dash 8 service ended on November 30, 1992, made possible through a new code-share agreement with Mesa Airlines. Mesa assumed the name "America West Express", taking it from the original cargo service started in 1985, and brought their existing Phoenix Essential Air Service routes into the America West system. America West's intrastate system was drastically increased through this code-share. On the other side, 747-200 Bird of Paradise service ended on September 9, taken over by a wet-leased ATA L-1011 on September 10. One requirement of the DIP financing was met with these two changes. On the positive side, America West Arena opened in 1992, conveniently visible to passengers on final approach to Runway 8L at Sky Harbor.
The forced discipline was what America West needed to prepare to emerge from bankruptcy. However, this forced discipline led to clashes between Franke and Conway. Conway would be ousted from the airline on December 31, 1993, replaced by A. Maurice Myers. Don Monteath, another founder, would leave the airline on December 31 as well.
Proving that the airline is a survivor, America West celebrated their 10th anniversary on August 1, 1993. Despite being in bankruptcy with an uncertain future, a look back was warranted. With the anniversary, new uniforms were unveiled on December 14. These uniforms were in place until 2003, when new uniforms were slowly introduced.
The DIP financing was extended several times, but America West was turning the corner to operating profits through the cutbacks. No new cities were added until December, when America West Express service was brought to Columbus. Mesa was operating an existing commuter division (Skyway Airlines) out of Milwaukee for Midwest Express, and America West placed their code on the flights, leading to some interesting routes - particularly Detroit-Rockford. The Columbus express operation would be restructured significantly in 1994, as Skyway was re-formed as a wholly-owned subsidiary of Midwest Express.
Another sacrifice of bankruptcy was the non-union workforce. America West's inflight CSRs first had a union election in 1989. That election failed, but it was contested by AFA for a number of years. The pilots certified ALPA as their bargaining agent in 1993.
The long road was starting to pay off, as AmWest partners announced their package for emergence from bankruptcy. The partners would control the airline through a new set of Class A stock, controlling 75.9% of the voting rights and 35% of the equity. AmWest partners consisted of Air Partners II (led by David Bonderman), Continental Airlines, Mesa Airlines, and Fidelity Management.
In February, the board unanimously endorsed AmWest Partners to lead the company out of bankruptcy, setting into motion the emergence of the company. Negotiations with lessors finalized the company's fleet plan for the rest of the decade. All Boeing orders were cancelled, and the 118 aircraft Airbus order was reduced to 24 firm aircraft, to be delivered between 1998 and 2000. GPA and Kawasaki ended up with 'put' options, where America West would be forced to take various aircraft at certain times until the A320 deliveries started. All of the growth in the fleet from 1995-98 came through these 'put' options.
The restructuring agreements included code-sharing agreements with Mesa and Continental. In Mesa's case, the 1993 agreement was amended to include Fokker 70 jet aircraft, and Embraer 120 aircraft were added for certain Express markets. Mesa also increased their gate usage at Phoenix to include B-5, with B-7 added after the Fokker aircraft came online in 1995. Continental's agreement was the first domestic major airline code-share, with joint ground handling in certain cities, and code-share flights. The first Continental code-share flights commenced October 1, 1994.
August 25, 1994 was emergence day for America West. The airline left bankruptcy a new company, with reduced debt, a focused management, and new hope. It was not the same company, though. Unions were coming in, with AFA certified as the bargaining agent for Inflight CSRs in September. It marked the official end of fully-cross utilized CSRs. As growth at Phoenix occurred, it reached the point where most people just stayed in their own work area in the hub. Field stations remained cross-utilized. CSRs had to choose whether to work as full-time flight attendants or full-time ground operations.
While free drinks were eliminated in the bankruptcy, America West still offered free Wall Street Journal newspapers to passengers. Fast Check survived until 1994. Flightlink II, a new digital in-flight phone and entertainment system, was installed fleet-wide starting in January. Flightlink included video games, audio entertainment, and advertisements (until the passenger removed the handset, turning the ads off.)
For enthusiasts, 1994 brought some color to the previously uniform fleet. The first special scheme aircraft, N907AW, rolled out in a commemorative Phoenix Suns livery on May 16. This was followed on October 29 by "Teamwork", N902AW, designed by Ann Rogan, daughter of pilot John Rogan. Nevada received their aircraft, N915AW, on December 15.
The beginning of 1995 brought major changes to the airline. Franke continued the cost-cutting that he started during the bankruptcy, with aircraft catering completely outsourced on January 17 - along with the closure of the Colorado Springs reservations center. Before this time, food preparation and hot meal delivery were outsourced, and cold snacks, beverages, and sandwiches were provisioned by America West personnel. Maintenance was the next to go, with heavy maintenance (C-check and above) outsourced on December 2.
The pilots signed their first contract on May 4, 1995, signing the first labor contract in the company and giving five years of stability with that workgroup. Code-sharing with Continental expanded on February 15, adding additional new markets in the Eastern U.S. Mesa added the Fokker 70 on June 12, with service to Fresno, Des Moines, and Spokane on the two new jet aircraft. Three EMB-120 Brasilia aircraft were added to the Express fleet in 1995 for higher demand markets such as Yuma and Flagstaff. Two more aircraft were repainted into special liveries during the year - Arizona, N916AW on April 20, and Ohio, N905AW on October 19. America West returned to Canada on June 15, with new service to Vancouver.
A marketing alliance was established with the expansion Arizona Diamondbacks baseball team. America West invested in the team, and placed several advertisements in the new Bank One Ballpark (across the street from America West Arena), and were designated the official airline of the Diamondbacks. A theme plane, N904AW, was unveiled on May 17, 1996.
Making up for the years of reductions during bankruptcy, a growth plan was announced on September 21, 1995. This plan would add new cities to the route map, many that had been dropped during the bankruptcy, as well as adding frequencies to the existing routes. The growth plan started in February 1996, after A. Maurice Myers' retirement on December 31, 1995.
On the service side, the airline announced on July 13 a program to add First Class interiors to all aircraft. While the Airbus and 757 fleets had First Class, the Boeing 737 fleet did not until this point. A new interior design was announced fleet-wide, standardizing aircraft interiors for the first time in the airline's history.
Joining this new interior was a new livery for the planes. Unveiled January 18, 1996, the new pearl white, orange and turquoise colors would give a new, southwestern image to the airline. Quickly nicknamed the "Jumanji" or "Jurassic" scheme by employees, it made the original 1983 colors look dated almost immediately.
The growth plan started on schedule, with six new cities added in the first half of the year. The rapid growth led to reliability problems, a high cancellation rate, and maintenance issues, which raised the ire of the FAA. Richard Goodmanson, the Australian who became President in June, was tasked to fix the operational problems.
The reliability program, named "Getting the Product Right…Together" led to a series of initiatives. New overnight maintenance bases were opened at Orange County and Columbus, 250 additional reservation agents were hired, new software was installed for reservations, and a program was implemented to emphasize on-time departures for the first flights of the day.
On the customer service side, Effortless Ticketing was established. This program would bring Electronic Ticketing to the airline, several years after it was first established with ValuJet. Shortly after it was introduced, 25% of America West's tickets were electronic. By 2002, a majority of the airline's tickets were electronic. Enhancing distribution, America West's internet site (www.americawest.com) was unveiled in 1996. America West Vacations added America West Golf Vacations in 1996, and a code-share agreement was signed with British Airways. America West would feed British Airways' nonstop flight to London Gatwick from seven markets.
As the growth plan commenced, the existing Airbus order was revised to 24 A320 and 12 A319 aircraft, to be delivered starting in 1998, and 52 options for additional aircraft. The 737-200 fleet was being steadily retired, and plans were set to retrofit 14 of the 21 existing 737-100/200 fleet with hush-kits, allowing them to fly after December 31, 1999.
The growth plan not only focused on new markets, but also on rebuilding non-stops between Phoenix and the Northeast. These non-stops, cut in 1991-92 with the opening of Columbus, would prove to be money-makers for the airline, while taking capacity out of direct competition with Southwest and building the strength of the Phoenix hub.
1997 would prove to be one of the best years for America West. The reliability improvements were working, increasing traffic and on-time performance. America West was riding high as a company - capped by winning the J.D. Power Award for short-haul flights, and ranking first in baggage handling among major airlines. Only two cities were added, but additional frequencies were added between existing markets during the year.
Tempe Reservations moved to a new facility off Elliot Road, in preparation for the reconstruction of corporate headquarters. The original America West corporate headquarters off Mill Avenue was demolished, making way for a new nine story building to centralize corporate activities. The last of the Conway employee programs disappeared between 1996-97, when free child care was eliminated.
A restructuring occurred on December 31, 1996, when America West Vacations was spun off into a new subsidiary, The Leisure Company. This move was designed to allow more independent vacation acquisitions, which would happen in 1998. America West Airlines would also become a subsidiary of the new company, America West Holdings, Inc.
The beginning of 1998 would prove to be a high point for America West. The airline was riding high, recording record profits, winning awards, and growing rapidly. It would all change by the end of summer.
The relationship with Mesa had become strained. After proving to be unprofitable, the Fokker 70 aircraft were removed in 1997, and replaced by new Canadair Regional Jet aircraft. Mesa had severe operational problems in late 1997 through January 1998, leading to America West canceling their contract. Negotiations came rapidly, for this would have been a fatal blow to Mesa, and a new contract was announced in September 1998. This contract would allow replacement of most of the Beech 1900s with Dash 8 aircraft, and growth in the RJ fleet.
New schedules were put into place in April for the Las Vegas night operation, and in May for the Phoenix hub. The strains were becoming evident, and by summer, the operation had taken an ugly turn.
Operational problems reared their ugly head throughout the summer. Mechanical problems increased, unfavorable press ensued, and employee stress reached a breaking point. Union issues were becoming more and more common, for the flight attendant contract was still open. Mechanics elected the Teamsters as their representative, and were negotiating their first contract. Dispatchers had just concluded their first contract on April 13.
A well-publicized FAA fine was imposed on the airline in June. The then-record $5 million fine was imposed over maintenance issues, primarily oversight and changes in recommended procedures. America West admitted no wrongdoing, and half the fine was forgiven after a restructuring of the maintenance oversight procedures. Eventually, this would lead to yet another change in heavy maintenance contractors.
From the customer service side, a new America West Club (renamed from the Phoenix Club) opened in Las Vegas on August 11, taking over the old Delta Crown Room. October 4 brought the first America West Express (Mesa) CRJs to Columbus, with four aircraft assigned to the hub. These four aircraft would add frequencies to the mini-hub, and replace mainline service between Columbus and Philadelphia. Bringing the CRJ into the hub showed how the route system had changed, reducing reliance on the mini-hub.
The airline collectively breathed a sigh of relief when the Summer of 1998 was over. On a bright note, in October the first A319 entered the fleet, sporting a new interior with light blue slimline seats and new First Class seats. All new Airbus deliveries had this new interior, and throughout 2002, the rest of the fleet was retrofitted with this interior.
Another 757 was unveiled in a special scheme on December 15 - N908AW, painted for the Arizona Cardinals football team. America West reported record profits for the year, however, Richard Goodmanson would not be a part of it.
1999 brought two major union issues to the forefront. The Fleet Service Agents (ramp CSRs) voted to unionize in December 1998, and the flight attendant contract - now 10 years after the initial unionization attempt - was still open. In February, the National Mediation Board released the flight attendants into a 30-day cooling off period, threatening America West with the airline's first employee strike. An agreement was reached on March 20, narrowly averting a strike.
Hopes were high for a better summer for the weary employees. It was not to be. Another summer of operational problems, high cancellation rates, and poor on-time performance led to soaring customer complaints. America West was clearly not the same motivated airline it was during the 1980's. While net profits were up through sales of businesses such as America West Golf Vacations, operating profits started to slip.
A new concourse, dubbed N-1, opened at Sky Harbor in November. This 12 gate concourse gave America West the room to continue growing at Sky Harbor. Most of the gates are designed to handle Airbus aircraft, unlike the original A and B concourses.
February 1999 brought an interesting announcement. Holly Hegeman, of Planebusiness.com, broke the news that United was looking at buying America West. Press ensued, with United admitting that they were looking at purchasing the airline, and America West saying they would look at the offer. America West ended up rejecting the offer, saying it was best for stakeholders that the airline remain independent. Most analysts agreed that United was looking at the aircraft only, and not planning on keeping the Phoenix hub.
Gilbert Mook was brought in as Executive Vice President, Operations in April, and W. Douglas Parker was promoted to Executive Vice President, Corporate. Jeff McClelland arrived as Vice President of Operations in August, replacing Ronald Aramini. These changes were designed to improve the operational side of the airline, its weakest side.
October 21, 1999 brought another revised Airbus Order. This new order was for 15 A318 aircraft, making America West a launch customer, and 12 A320 aircraft. The A320s were scheduled for delivery between 2001-2003, and A318s between 2003 and 2004 to replace the 737-200 fleet. The alliance with Continental was expanded, adding 42 new cities including eight European destinations. At the end of the year, four 737-200 aircraft and N708AW, the sole 737-100 in the fleet, were retired, making the entire fleet Stage III compliant, and an alliance was announced with TWA. The TWA alliance started off with a frequent flyer program link, with future plans to code-share.
February 17, 2000 would prove to be an omen for the year. Eagle, the automated dispatch system, went down for over five hours. At the time, America West had no backup dispatch system, leading to over 280 cancellations over three days. Passengers were left stranded around the system, boosting the industry-high complaint rate. America West was rapidly becoming known as "America Worst" for its customer service and operational problems.
The relationship with the FAA was poor, leading to further restrictions on growth until the FAA was assured maintenance could handle the extra aircraft. The airline was not in good shape.
Changes needed to happen, and fast. Doug Parker was elected president of the airline in May, replacing Mook, and given the mandate to fix the airline. Immediate changes were put into place, focusing again on maintenance. The line maintenance staff was doubled, flight schedules were reduced to allow additional spare aircraft and more time to maintain the fleet, new systems installed, and new maintenance bases established in San Diego and Baltimore. Management began looking at the causes of problems and trying to solve them at the root, rather than fix the problems after they happened.
On the labor side, the Fleet Service Agents ratified their contract on June 12. Shortly thereafter, additional fleet service employees were hired in Phoenix, to support the initiatives designed to reduce delays at the hub.
Franke was taking a hands-off approach to the airline, and took over all corporate duties in August. Parker was given total control of the airline, and named CEO in December. Franke did keep the financial side of the airline in excellent shape, reducing long-term debt to $145 million in 2000.
The initiatives helped restore America West's relationship with the FAA. America West's Internal Evaluation Program was named a best practice by the FAA, and Maintenance would continue to win awards from the FAA during 2001 and 2002.
N902AW, Teamwork, was repainted into a new scheme in 2000. An employee contest came up with the winning design, designed by analyst Amy O'Rear, featuring landmarks from across the United States. The repainted aircraft was unveiled on June 12.
Profits were dramatically affected by the summer of 2000, and years of operational problems. America West Holdings made $7 million, but had a $12 million operating loss. America West would enter 2001 with hope for improvement, despite the open pilot contract which became amendable on June 12, 2000.
The industry entered a recession, and average fares began dropping dramatically. Airlines were losing money, but holding their own. America West was no exception, but they were also trying to restructure their operation. The TWA alliance ended before it really could start, with TWA's bankruptcy and subsequent purchase by American Airlines.
Something happened in the summer of 2001. America West ran a reliable operation. The changes paid off in on-time performance, decreased expenses, a more reliable fleet, and better customer service. Parker's initiatives were working, and working well. America West seemed to be turning the corner.
We all know what happens next.
I was working the ramp the morning of September 11. Those events will stick in my memory, as well as anyone else working that day. AWA had just started operating, with only approximately 20 flights in the air from the East Coast. Maintenance was done with their overnight checks, and watching TV while the ramp started working.
The word came out about a ground stop to New York, just after we heard that a plane ran into the World Trade Center. Everyone thought it was a small plane, and nothing major. The second plane flew into the Center. I was running bags out to the plane, heard about it, and could not believe it.
Our first departure was going. I was ready to push it off the gate, when three planes taxied in that morning - which was unusual, as there were no scheduled arrivals at that time of the morning. We never got the first plane off the gate.
We offloaded both the first flights, and went out to guard the bags and help passengers claim their bags. Everyone was in a state of disbelief. From there, we de-catered the flights, searched the planes and went back to the breakroom, expecting to resume flying later that day.
"Later that day" never happened. We ended up watching the TV news in the breakroom all day. I went out on the ramp at 11 AM, and never heard it so quiet in my life. It was downright eerie.
America West was scheduled to announce a 60 aircraft order on September 12, with $400 million in financing. That order was immediately cancelled.
Doug Parker had just taken over for Bill Franke as CEO of America West Holdings on September 1, and had to face the toughest time any airline CEO can face - a total shutdown of the national air traffic system. America West put in place re-start plans that were constantly pushed back. When airspace was finally reopened, America West was ready.
America West was the first major airline back in the air on September 13, and resumed the full schedule on September 16, becoming the first major airline to do so. It would be short-lived, as traffic dropped off dramatically after the attacks. The schedule was cut back on September 20, with severe reductions in many cities and voluntary leaves, along with unfortunate employee furloughs.
One side benefit of these cutbacks is maintenance had plenty of time to work on aircraft. America West was running out of parking spots in Phoenix, and was starting to send aircraft all throughout the system for parking and operational spares. Reliability soared, and cancellations dropped to unheard-of levels. America West became the #1 airline for On-Time performance in December 2001.
With the Air Transport Stabilization Act, America West was first in line for a government guaranteed loan. While the loan was provided by banks, the government would back it in case of default - something nobody wanted to see happen. The first two loan applications were rejected, and Doug Parker was living out of a borrowed conference room (borrowed from GE), making the changes necessary to ensure the loan went through.
America West was literally days from bankruptcy when the Loan Guarantee was approved on January 18, 2002. The process was a long one, but triggered rent reductions on the aircraft fleet, return of 11 aircraft, deferral of deliveries from Airbus, and rent credits from the city of Phoenix. The price was high, with the government obtaining warrants to purchase up to one-third of America West's equity at $3.00 per share. Employees were not required to take pay cuts, but labor costs had to be controlled under the agreement.
Parker changed the way America West operated early in his tenure, which helped during the loan guarantee. Instead of playing vendors off each other, Parker was inclined to work more closely with certain vendors and keep using the same vendors. This philosophy dramatically helped to ensure the airline's survival.
The fleet repainting project, started six years earlier, was completed in January, when aircraft 331 was repainted - marking the end of the original color scheme. Aircraft interiors were also being standardized, with the new A319 interior making its way into the rest of the fleet. Projects such as these that customers notice were continued, while other capital projects were deferred as part of the guarantee program.
On March 25, a new pricing structure was rolled out. America West dramatically lowered their walk-up fares, while removing restrictions and making travel more flexible. The competitive response from other airlines was swift, with Continental announcing the end of their code-share agreement within less than 24 hours. Other airlines dropped their fares into Phoenix and Las Vegas to unheard-of levels. Despite the reaction, America West stuck to their guns.
This one move changed the future of the airline yet again. Throughout the 1990's, America West was a "Low Cost, Full Service" airline - now, they have "Lower Fares, Fewer Restrictions". By the end of 2002, America West was hailed by the press, and started to be known as the second-largest low fare airline in the United States.
The pricing structure worked beautifully. America West's yields went up during 2002, bucking industry trends, and traffic went up. While unfortunately not turning the corner into profitability, America West was making all the right moves. The summer of 2002 was another good summer, with complaints continuing to drop and cancellations staying low. This was clearly not the airline it was during 1998-2000.
A new flight center, housing flight crew training and System Operating Control, opened in March, giving more room for growth and centralizing flight crew functions from several sites around Phoenix into one building. Front line personnel began receiving additional training during 2002, designed to keep the focus on the customer.
Customer complaints dropped to 0.77 per 100,000 passengers in October, marking the lowest complaint rate since 1996 and the first year since 1997 that America West did not have the highest complaint rate. America West repainted N902AW with a large American flag over the World Trade Center image to commemorate 9/11, unveiling the repainted aircraft on April 1, 2002.
On the Express side, growth from the 2001 contract started to kick into high gear. Express was brought into many West Coast mainline markets, adding frequency between banks to cater to origin/destination (non-connecting) travelers. These flights also added feed to the hub, supporting more mainline growth. Unfortunately, these flights also added fuel to the pilots' fire, for their contract was still open and being negotiated. The first CRJ-700 entered service in October, bringing First Class to America West Express flights.
An alliance started with Hawaiian Airlines in November, with Hawaiian's nonstop Phoenix-Honolulu service. America West Vacations began selling Hawaii packages, and Hawaiian's schedule was set up to allow maximum connections between America West and Hawaiian. America West does all ground handling for Hawaiian in Phoenix, cementing the alliance.
With the economic environment not improving in 2003, and the SARS threat, America West took some painful steps to ensure survival. 250 management-level employees were laid off on April 14. The airline announced the closure of the Columbus mini-hub on February 18, with a reduction from 49 flights/day to four flights/day by June 15. Coach food service on all flights was eliminated on May 13. In June, America West ended their 14 year sponsorship of the Phoenix Suns, due to the economic environment - leading to an interesting situation when arch-rival Southwest Airlines became the official airline of the Phoenix Suns - who still played in America West Arena.
In January, America West tested a new program, "Buy On Board". This program was a test to see how in-flight meal sales (similar to what PEOPLExpress did in the 1980s) would work on otherwise non-meal service flights. Feedback was positive among passengers on the test flights, but demand proved to be variable. The four week test offered significantly better food than was otherwise being served, and was copied rapidly by a number of other airlines.
Group boarding was introduced after a test period in the field cities (outside of Phoenix and Las Vegas). Instead of calling passengers by rows, passengers are now called by group, similar to Southwest. Unlike Southwest, America West still has assigned seats and First Class. Group boarding would be enhanced by switching to an Arizona State University-designed system, where boarding is performed as a "reverse pyramid". Web check-in was announced on May 13, allowing passengers to check in at home or work and go right to the gate to board. "Low Fare Finder" technology was added to the web site on March 13, leading to record sales on the web site throughout the year.
The pilots union leadership and America West reached a tentative agreement in February, with a rejection of the tentative agreement by the pilot group in March. All non-union employees were granted an across-the-board 3% raise in August, becoming one of the few airlines to still offer raises to non-union employees. An incentive program was put into place where if America West is one of the top three major airlines in on-time performance or customer complaints, a $50 bonus will be paid to all employees. The first payout came in mid-August for June's operating numbers, where America West was in the top three major airlines in both categories.
America West turned the corner to profitability in the second quarter of 2003, earning a $12 million operating profit and $95 million net profit (via government grants). Shortly thereafter, management made a bold move, announcing non-stop transcontinental service between Los Angeles, San Francisco, New York Kennedy, and Boston. These hub-bypass routes, the first transcontinentals since the short-lived Orange County to New York service, were designed to attract business travelers, and open up more connecting seats through the hubs. Service between Los Angeles and New York/Boston commenced on October 26, 2003, followed by San Francisco to New York service on December 19. San Francisco to Boston service commenced on March 1, 2004.
Surprising the industry, America West posted the first annual profit in three years for 2003. The $46 million profit even surpassed internal projections, giving eligible employees a 7.5% AWArd Pay profitiability bonus. The pilots and company came to an agreement on December 31, 2003, with a three year contract signed.
213 employees celebrated their 20th anniversary with America West during 2003, when the airline celebrated it's 20 year anniversary. The anniversary was low-key, with no formal celebrations for the public.
After a long period of evaluation, Buy On Board meal service (renamed to In-Flight Cafe, and managed by Sky Chefs) was added to all flights over 3 1/2 hours in January 2004. In May, the long-standing Airbus purchase order was revised to eliminate the A318 from the purchase agreement, replacing the orders with additional A319 and A320 aircraft to be delivered between 2005 and 2009. Service was added from Los Angeles to a number of points in Mexico and Canada (operated by America West Express), as well as Los Angeles to Washington/Dulles.
Due to high fuel prices and industry capacity concerns, America West reported a third quarter and full-year loss in 2004. America West's entry into Transcontinental flying sparked a fare war with incumbents United, American, Delta and Jetblue, leading to losses on the routes and a pulldown of San Francisco to Boston flying (with service ending October 31, 2004). At the same time, ATA filed for bankruptcy, leading to an opportunity.
America West and ATA started discussing merger plans as part of ATA's bankruptcy. Discussions went as far as intergrating employees and discussing fleet plans. America West was interested in the Chicago Midway operations in particular, as a way to expand away from the West Coast base and increase revenue. In the final bidding process, however, America West opted not to purchase ATA, due to competition for the assets from AirTran and Southwest - the latter of which ultimately succeeded in purchasing ATA assets.
A new pilot base was opened in Las Vegas in January 2005, marking the first time in many years that there were multiple crew bases at America West. On January 19, the last 737-200 aircraft flew for America West, operating a PHX-Ontario-PHX turn, covered with employee signatures.
A new marketing campaign was announced, called the "Get On Board" campaign. This campaign was unique for the attempt to brand the entire airline, both to employees and the public, and was the first one since the failed Electric Chameleon campaign of 2001.
Get On Board would be short-lived, as America West announced a plan to merge with US Airways on May 18. US Airways was in it's second bankruptcy, and the company offered an east coast presence that had eluded America West for many years. On September 27, 2005, the merger closed, ending the America West story and beginning a new chapter - that of the new US Airways.
The America West paint scheme will live on two heritage aircraft at US Airways, though. N838AW was repainted into the 1996 Heritage scheme, and as a surprise to many, N828AW was repainted into 1983 America West colors. This plane was dedicated at a ceremony in October 2006.
Like the Phoenix, the mythical bird that rose from its ashes, America West was reborn several times during its short, 22 year history. The airline proudly celebrated 20 years on August 1, 2003, with 213 first-year employees still with the company. It's been a long and winding path for the airline, but America West stayed the course to become the only post-deregulation Major airline, before joining with US Airways to create the second-largest Low Fare Airline.
The story wasn't over though. The management team of US Airways, primarily composed of former America West personnel, announced their intent to merge with American Airlines in February 2012, shortly after American declared bankruptcy. The merger was completed on December 9, 2013, making little old America West part of the largest airline in the world. In 2014, Ed Beauvais received the recognition he rightfully deserved with indoctrination into the Arizona Aviation Hall of Fame.