US Airlines has agreed a tentative deal with its pilots on a cost-cutting plan which could save the airline $100m (�63m) a year.

The move is part of the airline's restructuring plan aimed at keeping the company in business.

Last month the firm cut 2,500 jobs as part of its cost-cutting measures.

US Airlines filed for bankruptcy protection in August, after the airline was hit by downturn in air travel following the 11 September terrorist attacks.

Reorganisation on track

US Airways said the pay agreement still needed to be ratified by the Air Line Pilots' Association (ALPA) executive council.

Under the deal there would be some temporary wage cuts in return for productivity improvements.

"Our pilot union negotiators worked with us in the interest of identifying additional cost savings, and preserving jobs and pensions, and we greatly appreciate their efforts," said US Airways president and chief executive David Siegel.

The airline said it hoped the deal would lead to agreements with other unions, and would also help it in its bid for a $1bn loan guarantee from the Air Transportation Stabilization Board (ATSB).

The ATSB was set up to help US airlines in the wake of the 11 September attacks.

US Airways added that it still intended to put forward its reorganisation plan on 20 December.

First of many?

US Airways, the sixth biggest airline in the United States, was the first major US carrier to file for bankruptcy following the terror attacks.

It lost more than $2.1bn in the past financial year.

Under the Chapter 11 bankruptcy procedure, the company can continue operating while it attempts to restructure its business and return to financial health.

Last week United Airlines, the number two carrier in the US, also filed for Chapter 11 bankruptcy.

It was forced into the move after a bid to secure a $1.8bn loan guarantee from the ATSB was rejected.