Chamber says possible US Airways merger a concern

Chamber says possible US Airways merger a concern

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PHOENIX -

It's one of the valley's biggest and best-known employers. But what if US Airways merges with American Airlines and moves its headquarters from Tempe to Dallas?

A Phoenix-area business group is expressing concern about the prospect of US Airways relocating its headquarters if it merges with American Airlines.

On Tuesday, the North Scottsdale Chamber of Commerce released results of a new economic study it commissioned on a possible merger.

According to the Chamber, the study performed by economist Elliott Pollack indicates that Arizona's economy would lose a large number of jobs.

"After reading the analysis, it is abundantly clear that if US Airways leaves Arizona as promised, the situation will be concerning for Arizona's economy, and include massive job losses on several fronts," Executive Director Joe Galli said.

The Chamber says if this were to happen, it would result in the loss of 2,000 jobs locally with an additional impact of some 5,300 jobs with the possibility of reduced service or a smaller hub in Phoenix.  

A 25 percent smaller hub could lead to the loss of 4,600 jobs and decreased revenues for state and local governments in taxes -- $18 million per year.  

All together, it's a dismal picture.  However, there are two sides.

"The bottom line of this is there's going to be an economic impact," said Pollack.  "It's going to be negative, it's going to affect the direct employees, the indirect and the employees that are employed in other businesses because US Air employees and the indirect employees spend their money."

"..the example I continue to use is that when Boeing moved their corporate headquarters from Seattle to Chicago a few years ago, they moved 300 people," said Robert Mittelstaedt, dean of Arizona State University's WP Carey School of Business.

"Yes, it was the highest compensated people they moved, but it wasn't thousands of people."

What does US Airways have to say about this?  The company is engaged in confidential talks on a possible merger with American Airlines and won't grant interviews on camera.

"We will have a significant corporate presence in Phoenix, no matter what happens," stated John McDonald of US Airways.

It is worth noting that US Airways recently signed a five year lease for its headquarters in Tempe with an option for an additional five years. And the hometown airline insists it has no plans to get rid of its hub at Sky Harbor.

This is a developing story.  Stay with FOX 10 News for updates.

The Associated Press contributed to this report.

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