There was a rare day of good news and excitement this week at the Pittsburgh International Airport. The reason for the upbeat mood was the official arrival of Southwest Airlines, the pioneering and still-dominant low-cost carrier.

While US Airways and other so-called legacy carriers such as United and Delta airlines, are cumulatively generating billions of dollars in losses, Southwest makes money. Designed from the start as a low-cost airline, Southwest remains a model in terms of operating efficiency and cost control.

Flights in and out of Pittsburgh began early Wednesday morning, with 10 daily Southwest flights to Philadelphia, Chicago, Las Vegas and Orlando. More flights are expected to be added in the future.

Southwest's first venture into Pennsylvania was in Philadelphia, where it began offering flights about a year ago. That beachhead and now the service in Pittsburgh has dealt a blow to already struggling US Airways, which once counted on its near monopoly in Pittsburgh and gate dominance in Philadelphia to produce profits from ticket priced higher than fares in competitive markets. Southwest saw the pricing opportunity in US Airways' markets and moved in, forcing US Airways and other airlines to lower their fares in order to remain competitive.

The impact of all the competitive pressures on US Airways, still a major employer in western Pennsylvania, was clear on Wednesday when the airline restated its first quarter earnings - showing a loss of $282 million rather than the smaller $191 million loss that had reported only a week earlier.

Struggling with increased competition from Southwest and other low-fare airlines including AirTran, as wello as higher fuel costs and operating expenses that remain higher than industry averages despite recent rounds of cost-cutting and labor contract concessions, US Airways is in a fight for survival.

The airline had expected to emerge from its second bankruptcy filing in recent years by next month, but with the latest poor financial results, the schedule to return to financial viability might be pushed back further. And while all this is going on, the airline in said to be in merger talks with America West Airlines, based in Tempe, Arizona.

Analysts looking at the potential merger see some advantages but also express serious reservations about such a partnership's likely chances of success. The always-competitive airline business has been hit recently with higher fuel costs, additional, post-9/11 security expenses. The older, well-established companies such as US Airways, United and Delta are also at a competitive disadvantage due to health and pension benefits that are barely an issue for the newer airlines, including Southwest.

US Airways has been fighting for its life for several years now. The struggle, which has resulted in serious cuts to most workers' wages or benefits, has no doubt taken a toll on morale across the company. Still, most employees understand the reality of the situation and seem prepared to cooperate in returning the company to profitability.

Significant strides in cost reduction have been made at US Airways and the path to survival is clear, if not easy. Still, Southwest's arrival in Pittsburgh will only make the job more difficult.