US Air investor eyes Cuba as destination-report

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US Air investor eyes Cuba as destination-report  =

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Tuesday January 7, 2:00 PM EST =


NEW YORK, Jan 7 (Reuters) - One of US Airways Group's (UAWGQ) prospective=
 flight destinations could stir up a wealth of ticket sales -- and a bit =
of controversy -- if the bankrupt airline's biggest investor has his way.=


David Bronner, chief executive of the Alabama pension fund that will assu=
me a controlling stake in US Airways once it emerges from bankruptcy, tol=
d the Charlotte Observer he may meet with Cuban President Fidel Castro ne=
xt month to discuss the possibility of airline service between the United=
 States and Cuba.

"We do want to establish airline service into Cuba, and I'd love to be fi=
rst," Bronner told the Observer in an interview published on Tuesday. "On=
e of the things US Airways does well is the Caribbean, and Cuba (would be=
) gigantic compared to the rest of the Caribbean," he said.

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Business activity and travel between the countries has been severely hamp=
ered by an economic embargo the United States imposed shortly after Castr=
o's 1959 revolution, which brought his one-party government into power.

But Bronner's comments echoed the desire of many U.S. business leaders wh=
o want to see an end to the long-standing U.S. embargo, or at least an ea=
sing of the travel ban.

There are currently over 20 direct charter flights every week between Mia=
mi and Havana, Cuba, once a premiere Caribbean travel destination for U.S=
=2E tourists. The charters use planes from airlines like AMR Corp.'s (AMR=
) American, Continental Airlines (CAL), and AirTran Holdings (AAI), but t=
he airlines themselves do not run the flights.

Bronner, a major player in Alabama's financial community, plans to travel=
 to Cuba next month as part of a push to build more trade between Cuba an=
d Mobile, Ala., the Observer said.

Bronner's Retirement Systems of Alabama has agreed to put up $500 million=
 in emergency financing to run US Airways' operations, along with $240 mi=
llion for an eventual 36 percent equity stake in the airline and a 71 per=
cent voting stake.

While US Airways has thinned out its flight schedule and rejected scores =
of airplanes to lighten its costs during bankruptcy, it has added flights=
 to Caribbean destinations like Jamaica and Puerto Rico as part of its gr=
owth strategy.

The Arlington, Virginia-based airline and its express service serve 25 Ca=
ribbean destinations. While US Airways spokesman David Castelveter said n=
o plan was in place for expansion into Cuba because of U.S. government tr=
avel restrictions, he said Cuba would be consistent geographically with t=
he airline's growth strategy.

Cuban officials have taken steps to build up the island's tourism industr=
y, and some predict the travel ban will be lifted in the near future.

An international airport that can receive wide-body jets opened last mont=
h on Cayo Coco, the biggest key along Cuba's sandy north shore. Nearly a =
dozen luxury hotels are already situated in the area. =



=A92002 Reuters Limited. =


Roger
EWROPS

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