BA spurns US pilots' call to boost stake

A PROPOSAL from the pilots' union at USAir for British Airways to invest a further dollars 450m in the carrier was quickly shot down yesterday, with BA saying that it would not be putting up any more cash until the carrier completed its own restructuring.

The reaction from BA surprised the Air Line Pilots Association, which only delivered details of its plan to USAir management at lunchtime yesterday. The ALPA is offering to take salary cuts worth dollars 750m over five years, in return for a 25 per cent equity stake in the airline, plus equivalent payroll cuts at management level and board representation.

But yesterday evening a BA spokesman in New York said that 'on the basis of the conditions outlined by the USAir pilots it is clear that British Airways could not contemplate further investment in USAir. (BA) has already stated it was freezing further investment in USAir until USAir has completed its process of restructuring to the satisfaction of British Airways'.

A spokesman for the ALPA pilots at USAir expressed surprise at this statement, and at BA's position that the restructuring is a matter to be decided between USAir and its employees - with BA as an onlooker until the process is completed.

'It's obviously night-time in London and the New York office is repeating their position from a few months ago,' the spokesman said. 'I would be amazed if they could analyse and reject our plan in a few hours.'

BA owns 24 per cent of USAir, and has considered taking a write-down on its original dollars 400m investment as the carrier struggles with a high cost base and stiff competition from rival low-cost airlines. USAir management said yesterday that 'the ALPA proposal raises serious concerns with respect to complex issues'. A spokesman declined to elaborate.