US Air Emerging from Bankruptcy

US AIRWAYS PLAN OF REORGANIZATION
RECEIVES U.S. BANKRUPTCY COURT APPROVAL

Company on Track to Emerge from Chapter 11 and Complete Merger
with America West Airlines as Early as Sept. 27, 2005

ARLINGTON, Va., Sept. 16, 2005 - US Airways is now in the final stages of completing its transformation into the nation's first full-service, low-cost airline with today's judicial confirmation of its Chapter 11 Plan of Reorganization (POR).

Judge Stephen S. Mitchell of the U.S. Bankruptcy Court for the Eastern District of Virginia confirmed the plan at a hearing today, clearing the way for the US Airways-America West Airlines merger transaction to formally close by the end of September. The merger will create the nation's fifth-largest airline, and provide consumers with new domestic and international travel choices and an extensive route network throughout the U.S., Canada, the Caribbean, Latin America, and Europe.

Judge Mitchell ruled that all necessary requirements have been met for US Airways to implement its POR. Every class of creditor for all five debtors - US Airways Group, Inc.,
US Airways, Inc., PSA Airlines, Inc., Piedmont Airlines, Inc., and Material Services Company, Inc. - in the Chapter 11 cases that was entitled to vote on the POR, voted in favor by at least 90 percent in dollar amount and 80 percent in the number of votes cast. Under the terms of the merger agreement, the transaction can close on the 11th day following entry of the court's final order confirming the plan. US Airways then will emerge from Chapter 11 and complete its merger with America West as soon as Sept. 27, 2005.

"This is a great day for both US Airways and America West," said US Airways President and Chief Executive Officer Bruce R. Lakefield. "For our customers, we are about to become the kind of airline that they have been asking for - a global carrier offering full-service amenities and simplified fares. For our employees, this merger will provide more stability and a chance to be a part of a vibrant new company.

"Through our restructuring, we have reduced our debt, improved our liquidity and strengthened our balance sheet," Lakefield said. "With the financial position of other carriers deteriorating, we are pleased that we will have a very strong cash position, a robust business plan, a low cost structure, and a strong network that offers our customers an attractive product and more choices."

Key elements of the plan include:

? Total equity and liquidity agreements to provide the merged airline with unrestricted cash of approximately $1.7 billion, and a total cash position of approximately $2.5 billion, including approximately $800 million of restricted cash.

? Investment agreements that total $565 million in new equity and a public stock offering that is expected to raise $150 million. Support from business partners and suppliers that will provide in excess of $700 million in cash, and asset sales and sale-leaseback agreements that are expected to gross $300 million pending consummation of certain of the transactions.

? Agreement between US Airways and the Pension Benefit Guaranty Corp. (PBGC), resolving nearly $2.7 billion in claims. The agreement provides for
US Airways to pay the PBGC $13.5 million in cash, in addition to giving the PBGC a $10 million note and 70 percent of the common stock, which will be allocated to unsecured creditors.

? The creation of a company with more than $10 billion in annual revenues and savings of over $600 million annually through synergies associated with the merger.

? Reinstatement and extension of the Air Transportation Stabilization Board (ATSB) loans with amortization through 2010.

Lakefield said that the company's full attention now will be on the completion of the merger, the implementation of consistent customer service offerings, the building of a unified corporate culture, and the transfer of headquarters functions to Tempe, Ariz. America West Chairman, President, and Chief Executive Officer Doug Parker will assume those same responsibilities at the merged company, with Lakefield serving as non-executive vice chairman of the board of directors.

"Doug Parker and the management team he has assembled are enthusiastically working to make sure that the new US Airways is an airline that offers customer value, and one which our combined work force is proud to represent. I want to express my heartfelt thanks to our employees, customers, and business partners for their support of the company throughout this restructuring. Doug is committed to building upon that deep level of support and loyalty," Lakefield said.

Lakefield also expressed his appreciation to the ATSB for its support in working through a number of issues related to the America West and US Airways federal loan guarantees.

US Airways Group, Inc. and its domestic subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code on Sept. 12, 2004.

The merger of US Airways and America West will create the first full-service, low-cost nationwide airline with amenities that include international scope, a broad frequent flyer program, airport clubs, assigned seating and First Class cabin service. The airlines have already introduced the new US Airways aircraft livery design, and over the coming weeks, will be announcing more specific customer service enhancements and policies as the airlines implement the merger.

US Airways is the nation's seventh-largest airline, serving 183 communities in the U.S., Canada, Europe, the Caribbean and Latin America. US Airways, US Airways Shuttle and the US Airways Express partner carriers operate approximately 3,200 flights per day.

America West operates over 900 flights daily to more than 90 destinations in the U.S., Canada, Mexico and Costa Rica. America West offers a range of services including more destinations than any other low-cost carrier, First Class cabins, assigned seating, airport clubs and an award-winning frequent flyer program.