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U.S. Airways Extends UK Service

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Amid all the excitement surrounding its proposed merger with American Airlines, U.S. Airways Group Inc. (LCC) announced the availability of non-stop daily service between Philadelphia and Edinburgh from summer 2014. The new route marks the 19th trans-Atlantic destination from the company’s international hub at Philadelphia.

The new service will add to U.S. Airways’ existing network between Philadelphia and different parts of the United Kingdom and British Isles that include Glasgow, Dublin, Manchester and London.  

The Edinburgh-bound flight will take approximately 12 hours and the Philadelphia trip will take three hours longer. Pre booking for both trips is already on. U.S. Airways will use a 176-seater The Boeing Company’s (BA) 757 aircraft for the new service, which will be available from May 23, 2014.

Airline traffic demand is expected to increase next year as Scotland is set to host two popular sporting events – the Commonwealth Games and Ryder Cup. U.S. Airways wants to tap this opportunity by offering direct routes between the countries and eliminating the need for visitors to take connecting flights. Further, the new airline service will not only enhance passenger count but also increase the transatlantic offering in Scotland’s busiest airport.

Recently, US Airways Group Inc. and American Airlines Inc, a subsidiary of AMR Corp. got the green signal from Department of Justice for their proposed merger, which will create the largest global carrier. As part of the clearance, the airlines will have to give up 52 take-off and landing slots at Washington’s Regan National Airport and 17 pairs at La Guardia airport in New York.

Post-merger, the new company will likely have nearly 6,700 flights daily and generate annual revenues of roughly $40 billion. We believe that these new routes will strengthen the trans-Atlantic network of the combined entity, as American Airlines already holds a dominant position on the London-New York route.

U.S. Airways currently carries a Zacks Rank #1 (Strong Buy). Other stocks within this sector with the same Zacks Rank are China Eastern Airlines Corporation Limited (CEA) and Spirit Airlines Inc. (SAVE).

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