USAirways Joe Beery Sr Vice President and Chief Information Officer

For the Record Yes your aircraft is very safe you have nothing to worry about I do not control where we fly to, I can not get another flight into your city or more First Class Seats I did not cancel your flight I did not lose your luggage and I can not find your luggage

USAirways Who We Are PWM OAJ MGW LEB AOO ISP RKD ABE ALB AVL AVP BTV BUF CAE CHA CHS CLT CMH CRW ELM ERI FAY GSO GSP HPN ILM ITH LGA LWB MDT MHT ORF PVD RIC ROA ROC SYR TRI TYS OGS MSS HVN ERI ACK MVY ART BFD FKL JHW LBE DUJ JST PQI HYA AUG BHB PHF SBY CHO CVG SHD HGR HTS LYH CKB LNS FLO EWN PGV AHN AGS BLF BKW HHH SWF BGM IPT SCE GCK DDC HYS GBD MHK ALB BUF CAE CHS CMH LGA MDT ORF PVD YYZ SLN SAV TLH CAK CMH DAY YUL CAK CHA DAY HSV TYS YUL CAK YOW LIT SCE BGR JAN GNV MGM MOB SDF XNA GRR JAX LEX PNS EYW LAS GCM BHM STT SXM NAS SDQ BDA BNA JAX MBJ MSY RSW SJU SRQ AUA FPO BGI CZM BZE PLS PUJ SJO SAL GUA PTY KIN LGW FCO MAN CDG FRA MAD MUC AMS GLA YYC YVR SNA PSP YUM OGG SJD PVR SAN LIH MZT SJC HNL SFO HII HMO GYM GDL AUS BOI MEX CUN ORD ATL BDL BOS BWI CLE CMH DCA DEN DFW DTW EWR FLL IAD IAH IND LAS LAX MCI MCO MEM MIA MKE MSP PBI PHL PHX PIT RDU SEA TPA STL ABQ ANC ASE BFL BIL BUR CLD COS DRO DSM ELP EUG FAT FCA FLG FMN GEG GJT ICT IGM PRC JFK RNO SBA SBP SLC SMF TUS LGB MFR MRY OAK OMA ONT PDX SAT KOA TEX YEG 32 Countries/Territories (Europe, Mexico and Caribbean) 223 Total Destinations

The Merger A Tale of Two Cities (East and West)

Background US Airways (East) –Outsourced to Sabre/EDS since 1998 prior to Y2K –Similar to American Airlines –Limited new development, no technology refresh –Legacy systems and infrastructure –Survived 2 Bankruptcies America West (West) –EDS hosted Reservations System –Internal development in most areas –Recent upgrades were Tier 1 providers –Modern network and infrastructure in the field

Integration Strategy Migrate to lower cost internally supported systems (In sourcing) Scale and integrate current applications Add functionality where needed (international) Leverage internally developed distributed applications Americawest.com will be re-branded to USAirways.com Americawest kiosks will be re-branded FlightFund system will be renamed to Dividend Miles Achieve synergy savings $100 Million

Challenges Run 2 airlines daily operations Move the from an outsourced model to a hosted model (new EDS contracts) Ramp up staffing in the IT department Integrate the systems and upgrade the infrastructure

Infrastructure Convert from a legacy multi protocol environment to a modern IP network. –$45M Airport upgrades 10,000 new desktops All new switches, hubs and routers 800 new kiosks –Voice upgrades Call center and campus switching 2 nd Datacenter upgrades

Reservations System Specifications US Airways operated with approximately 3M Passenger Name Records and 5M e-tickets. America West operated with approximately 2M Passenger Name Records and 3M e-tickets. Cut Over in 8 hours

Airline Operations Phased approach based on Fleet type, migration happened over time. Massive data migration –Aircraft parts –History Migrated the dispatch center over night Currently building a new command center

IT systems were merged in 25 months achieving a single operating certificate. Sept 2005 – Oct 2007

A “needy” business group is a good indication that they are very engaged and consequently well prepared for cutover. Small program team was able to maintain tight control over the entire program, managing changes well with a high quality of communication. Dress rehearsals were invaluable in uncovering issues with timing, and technology. Migrations are so complex, it’s best to have it in-house. There is an important difference between high level working knowledge and a deep understanding of how things actually work. Lessons Learned –What Worked Well

Lessons Learned – What Didn’t Work Well Training Training Training Insufficient process testing by airport team did not reveal Agent training shortcomings prior to cutover. Still working on the labor contracts

IT Strategy Today and Going Forward

IT Investment Model IT Market Place is broken up into 4 major sectors: Hosting Buy Build Out Source Sabre EDS AWA US New Our Goal is to move more to the middle

Build vs. Buy Build Criteria: 1.Significant competitive advantage 2.Speed of execution is desirable and the environment is very dynamic 3.No provider exists in the market place Buy Criteria: 1.Tier 1 provider 2.Strong market position 3.Solid technology with a good investment plan

Innovation Leading Edge First Follower Late Adopter Bleeding Edge Innovation is based on desired risk/cost and ROI. Cost and Risk $$$ Return on Investment (ROI) We will be a good “First Follower” US New

Internet and AirportsBuild Self Service Kiosks and Gate Readers Internet Distribution –USAirways.com –USAirwaysVacations.com

Employee and Back Office Continued implementation of the ORACLE Suite. -Human Capital Management- Payroll -Purchasing- Fixed Assets- I-Learning -I-Recruiting- Cash Mgmt- Accts Rec -Contract Mgmt- Budget and Forecasting Enable self service options for Human Resource Functions. Enable all employee travel benefits on-line including family members. Provide on-line training for Airport and Reservations. Standard industry proven package Buy

Longer Term 3 to 5 Years We are going to have to upgrade the reservations system. There are other partners that may have options in 3-5 years, we are currently evaluating all options. Service Oriented Architecture (SOA) will enable more seamless application integration at much lower costs (Microsoft, ORACLE). All applications will have to operate in a handheld mobile configuration (In-flight entertainment, reservations, customer/employee notifications).

Where are we Today

The Industry Unprecedented financial crisis because of fuel (again) Consolidation continues –America West – USAirways (Done) –USAirways - Delta (Almost) –Delta – Northwest (Working) –USAirways – United (Almost)

2008: The Price of Fuel Fuel expense will cost the industry an additional $18 billion in 2008 versus 2007 and US Airways nearly $2 billion WTI ($/bbl)

Fuel Expense Mainline Passenger US Airways’ average fuel expense per round trip mainline passenger will average approximately $300 in 2008.

Fuel Prices Impacting Entire Industry

Industry Response Significant Capacity Reductions –All major airlines reducing U.S. capacity –Domestic Available Seat Miles (ASM) expected to be down 9% in 4Q08 and down 9% in 2009 vs New Revenue Streams and Cost Reductions –Baggage fees (First Bag, Second Bag, Third Bag) –Choice seating –Removal of in-flight entertainment system –Removal of ovens

Industry Response Introducing a new in-flight beverage purchase program. Amending the airline’s Dividend Miles frequent flyer program. These are aggressive responses that will have a material impact on future industry financial performance

Thank You