ARLINGTON, Va., July 1, 2002 —US Airways Group, Inc. today said that it completed submission on June 28, 2002, of its final application with the Air Transportation Stabilization Board for a $900 million federal loan guarantee of a $1 billion loan - including identification to the ATSB of the initial lenders that have agreed to participate in the financing by providing the $100 million “at risk” portion of the loan.

The Company also said that it will begin deferring payments on public debt relating to aircraft that have already been grounded as well as selected older Boeing aircraft in service that have been targeted for debt modification as part of the Company’s restructuring plan. The Company is currently negotiating with various creditors to reduce and restructure its costs and obligations under existing agreements, and these discussions will now include indenture trustees of the public debt issues affected.

As previously announced last week, the Company noted that the payment deferrals were not linked to the Company’s current cash position and said it will otherwise continue to pay its day-to-day obligations and does not anticipate any impact to its customers, employees, airports or other operations from the strategic payment deferral program.

“We are pleased to be able to report positive progress on our ATSB application. Today`s decision to defer payments on selected public debt and begin negotiations with affected trustees is a logical step to successfully conclude our restructuring activities,” said President and Chief Executive Officer Dave Siegel.

“We continue to devote our attention towards completion of a voluntary restructuring plan, which requires modified labor agreements to reduce labor costs, as well as permit the implementation of an international and domestic alliance and add a very substantial number of regional jets. The timely completion of labor negotiations - along with agreements with key lenders, lessors and vendors to reduce costs - and the issuance of a federal loan guarantee, should allow US Airways to successfully restructure outside of Chapter 11 reorganization,” Siegel said.

Certain of the information discussed above or enclosed herewith should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Act of 1995. A number of risks and uncertainties exist, which could cause the actual results to differ materially from the results projected in such forward-looking statements. Additional information concerning the factors, which could cause actual results to differ materially from the forward-looking statements, will be contained in a Form 8-K filed with the Securities and Exchange Commission. US Airways assumes no obligation to update such estimates to reflect actual results, changes in assumptions or changes in other factors affecting such estimates.

Reporters needing additional information should contact US Airways Corporate Communications at (703) 872-5100.

——-