The US Airways (NYSE: LCC) ticker symbol says it all: LCC = Low Cost Carrier. With its latest announcement, the airline may want to change it to LEC -- Low Expense Carrier. In an attempt to keep pace with the plunging travel market, US Airways is cutting 1,000 jobs next year, shoving almost all its flying to its three hubs (Philadelphia, Phoenix and Charlotte) and Washington. Several international routes are being cut.

The airline reports that routes from its hubs have been profitable. Currently, US Airways pushes 93% of its flights through these airports, a rate it seeks to push up to 99% in 2010.

Affiliated Computer (NYSE: ACS) will be acquired by Xerox (NYSE: XRX) for $63.11 per share in cash and XRX stock. ACS shareholders will receive $18.60 per share in cash plus 4.935 XRX shares for each ACS share they own. ACS closed at $47.25. ACS October option implied volatility is at 27, November is at 28; below its 26-week average of 31 according to Track Data, suggesting decreasing price movement.

US Airways (NYSE: LCC) closed of $4.96. WTI Crude futures are recently down .48% to $65.70 according to Bloomberg. LCC October option implied volatility is at 93, December is at 107; below its 26-week average of 120 according to Track Data, suggesting decreasing price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

United Airlines (NASDAQ: UAUA), US Airways (NYSE: LCC) and American Airlines (NYSE: AMR), according to an influential analyst, have run out of options. Jamie Baker of JPMorgan said in a July 20, 2009 report that these companies couldn't do anything to prevent a cash crisis. They only savior available to them would have to be an outside investor. To call the position grim would be optimistic. Unfortunately, it couldn't have come at a worse time.

As Baker was walking the bear into the airline industry, United was starting to celebrate its change in direction. The carrier has improved its on-time rate, according to a USA Today report, and its operations are coming around. Despite the fact that the airline industry has been brutalized by the global recession, the airline has made some progress. Through August, the company's share price doubled, and its ascent has continued in September. So, the company is locked in an ongoing struggle to manage its identity, cope with its past and shape how the world sees it today.

The operational "makeover" has resulted in a reduction of its fleet from 601 jets in 2000 to 386 as of the summer of 2009. In terms of passenger traffic, it's in the #4 spot in the United States – trailing Delta (NYSE: DAL), Southwest (NYSE: LUV) and American. With Q2 revenues off 25.2% year-over-year, however, drastic measures are still necessary.

August brought more misery to the airline industry in the United States. Seven of the country's nine largest carriers saw traffic drop, with only Southwest Airlines (NYSE: LUV) and JetBlue Airways Corp (NASDAQ: JBLU) bucking the trend. The continued upward climb of unemployment, tighter corporate budgets and sluggish demand for leisure travel has resulted in fewer passengers in seats.

JetBue was the only carrier not to report a drop in available seat miles (ASMs), the primary measure of airline productivity. Load factors, however, which indicate how full a plane is, tended to be higher, largely a result of flights that have been cut in an effort to reduce costs.

US Airways (NYSE: LCC) is trimming 600 ground jobs and closing other services in an effort to cut costs. The airline had hoped not to cut this many positions, anticipating that resignations and departures would do the hard work for it. But employee attrition fell sharply from last year – probably because this isn't exactly the best market for job hunting. Unfortunately, the same reasons that cause employees to stay force US Airways to cut them loose.

At nine airports, US Airways is moving to outside contractors for ramp work. The Las Vegas US Airways Club will close and its staff cut. Also, the walk-up ticket counter at the airline's Tempe, AZ headquarters is on the chopping block.

Continental Airlines (NYSE: CAL) is seeking immunity from antitrust laws to work more closely with United Airlines (NASDAQ: UAUA) and others on international routes. And, since airlines operate in a state of seemingly perpetual turmoil, what's the harm? According to the Justice Department: plenty.

The airline sought broad immunity as part of an effort to join Star Alliance, which includes US Airways, Lufthansa (OTC: DLAKY), and Air Canada -- along with United. Continental believes that it needs to join Star Alliance in order to remain competitive, especially with airlines that have this type of immunity already.

JetBlue Airways Corp. (NASDAQ: JBLU) is looking to sell 20 million shares of common stock and $150 million in convertible debt. Miserable conditions for the airline industry have led the low-cost carrier to turn to financial markets for the infusion that operations can't seem to deliver.

The debt, which is convertible into common stock, will be sold in two $75 million series. And the 20 million common shares would raise another $101 million (at yesterday's closing price of $5.03). If there's enough demand for the debt and equity securities, JetBlue may sell another 3 million shares of common stock and another $11.25 million in debt.

JetBlue isn't alone in raising capital. US Airways Group Inc. (NYSE: LCC) is planning to ask its shareholders to approve a measure that would double the amount of common shares it could issue to 400 million. The answer will come at the company's annual meeting on June 10, 2009.

After the airline went through bankruptcy twice, turnaround expert George Putnam now sees improving long-term prospects for US Airways (NYSE: LCC).

In his The Turnaround Letter, the advisor suggests, "When travel does begin to pick up again, US Air with its lean cost structure should profit handsomely." Here's his review.

"US Airways began in 1939 as All-American Airways delivering mail to Western Pennsylvania and the Ohio Valley; from there it grew through acquisitions to be a major national airline.

A nice little story came out a couple of weeks ago but hasn't gotten much press, what with stimulus packages and "bad banks" and Jessica Simpson's alleged weight gain. Richard Branson, eccentric billionaire and founder of Virgin Atlantic Airways, is reaching out to Captain Chesley "Sully" Sullenberger, the pilot of US Airways Group (NYSE: LCC) Flight 1549, in hopes of putting the hero on the Virgin payroll.

Branson told a New York Daily News reporter, "We'll make him the best-paid pilot at Virgin -- we'll give him double [the salary of] anybody else. He also can become one of the astronauts in my intergalactic spaceship company. The man can write his own ticket with me ..." In response, a flattered "Sully" said he is weighing his options, which recently included a cover shot on People magazine.

US Airways (NYSE: LCC) is recently up 59 cents to $7.98. LCC Airbus A320 plane went down in the Hudson River off of 50th Street in NYC. WTI Crude futures are recently down 6.33% to $34.92 according to Bloomberg. LCC call option volume of 5,703 contracts compares to put volume of 2,905 contracts. LCC February option implied volatility of 131 is below its 26-week average of 142 according to Track Data, suggesting decreasing price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Minyanville Professor Minyan Peter dares to share the kind of keen insight and actionable information you won't find in any prospectus. For more original thought, visit www.minyanville.com.

As many people have heard before, there are only two times a company issues common stock: When it absolutely has to or when it is stupid not to.

Well yesterday's issuance by US Airways (NYSE: LCC) may represent that once in a lifetime opportunity to see those seemingly contradictory principles in action at the same time. Having seen its stock trade at $1.45 not a month ago, $8.50 must seem pretty sweet to US Airways management, particularly with strong technical resistance at $10.00 providing a pretty strong ceiling above.

With airline stocks trading as the most leveraged play on the price declines in oil, I can understand why US Airways management took advantage of the window being open to issue stock. But just because the issuance window is open, doesn't mean investors should jump.

"If there's one sector that stands to benefit handsomely from a further slide in oil or, at least, a moderation in crude's rally: the airlines," explains energy sector expert Elliott Gue.

In The Energy Strategist, he says, "Airlines may make a terrible long-term investment but can be an outstanding short-term trade." Here he looks at Delta Air Lines (NYSE: DAL) and, for the even more speculatively-inclined, US Airways (NYSE: LCC).

"Some investors will rightfully cringe from any mention of this sector; after all, the airlines have consistently lost money throughout their post-deregulation history.

"Most of the majors have declared bankruptcy on multiple occasions since that time. However, we've traded the airlines on a few occasions; we took some triple-digit percentage gains in the airlines back in 2005.

"The airlines' leverage to oil prices is well known. Expectations are so low, in fact, that several major air carriers actually managed to beat consensus expectations in the second quarter.

"And although sentiment is already at rock-bottom, there's a real basis for cautious optimism. First, if I'm right about oil, fuel costs won't rise appreciably in the third quarter. This huge headwind is dissipating.

These are tough economic times for the nation, most would agree, and one hard-hit sector has been the airline sector, specifically the major carriers.

Surging fuel costs, the increased precautions and reviews required for the post-September 11 era, and intensifying competition for international routes has led to large losses among many major carriers - - a condition that has forced them to raise fares and implement other cost-cutting changes.

Most have also instituted a baggage fee for a passenger's second bag, with some carriers charging for all bags. Still, for the most part travelers have taken the baggage fees in stride. Although viewed as a nuisance by many travelers, the reality is a second bag, in particular, is optional weight that increases flying costs per mile. And with aviation fuel zooming past latte-price levels, that's no significant expense.

Still, US Airways Inc. may have gone one too far with the fee system. Effective today, US Airways will start charging for water on flights by coach passengers, The Wall Street Journal reported Friday (subscription required). Bottled water will be $2. Passengers flying first class are exempt from the extra fee.

You've been enjoying yourself too flying US Airways flights, haven't you? No more frivolity. The US Airways experience will make the Chinatown bus look lush. US Airways Group (NASDAQ: LCC) announced these latest passenger torture methods: no movies, no curbside check-in at 34 airports -- and that's on top of recent plans to charge $2 for cokes or coffee. You'll pay extra to use some of your frequent flier rewards, an additional $15 for checked bags and $25 to book on the phone. And if you want a window or aisle seat in the front of coach -- 16% of coach -- it'll cost you $5 to $30 more per segment.

The stock is down about 5% today on these grim announcements and word that the airline is cutting 2,500 jobs (and perhaps on oil prices). It had already planned on cutting capacity, though it had positive news yesterday, with good scores for being on time. US Airways says the current new fees will bring in $250 to $300 to $400 million. I don't think price-conscious passengers are going to remain oblivious to the idea that an airline ticket is not the real price anymore. It'll be like renting a car -- you know that it's really going to cost you twice as much as the rate.

US Airways says it is cutting movie service because the 500-pound machines cost them $10 million in fuel and other costs. It'll keep the movies on flights to Hawaii and overseas. The real problem with the big airplane screens is that nobody is renting the headphones anymore. I don't remember the last time I watched a movie -- or even one of those schlocky sitcoms the airlines seem to love -- on a big airplane screen. We all want our own entertainment -- and bring it in the form of MP3 or DVD players. In an effort to appeal to the broadest audience, the industry has bored everyone. Reuters says that a cut in inflight movies -- if it goes further -- could hurt the entertainment industry, which makes roughly $240 million a year from airlines.

Fuel prices seem to be the number one concern on just about everyone's mind lately, and it seems like things are not going to be getting better any time soon. As prices have risen to record levels, many of us have decided to cut back on our driving, especially on long trips in order to save a little on our fuel prices. Well, the airlines are no different, and there's an interesting report today in The Wall Street Journal showing how airlines are cutting back on long flights in order to save a little on fuel consumption.

It is a pretty nasty cycle we are seeing with the airlines. The higher fuel costs have led to higher tickets prices and extra fees. These higher prices have led to less air traffic, and that has led to an even greater need to find more ways to cover rising costs. Definitely a tough situation.

The new way they are starting to combat the high costs of flying is by cutting back, or postponing long international flights, in particular flights that are in excess of 12 hours.