Fri, May 16, 2003
Creditors to Help Airline Survive Outside Chapter 11
AMR Corp.
reached another major milestone in its long-term cost restructuring
efforts Thursday with the announcement that it has completed
agreements on concessions with more than 100 suppliers, aircraft
lessors, and other key creditors that will save AMR in excess of
$175 million a year. These agreements will generate cumulative
savings for the company of more than $1 billion.
A billion here, a couple billion there -- pretty soon it's
'real money'
During the past two years, AMR has identified approximately $2
billion a year in cost savings through a wide range of initiatives,
and last month AMR's three major labor unions ratified new
agreements which, when coupled with changes in pay plans for
management and non-union employees, will reduce AMR's costs by an
additional $1.8 billion a year.
The final piece of AMR's overall $4 billion-a-year
cost-reduction effort was to reach agreement on meaningful
concessions with AMR's suppliers, lessors, and other creditors.
"We are grateful to each supplier, lessor, and creditor who
tangibly expressed support for our company by granting these
significant concessions," said AMR Chief Executive Officer and
President Gerard J. Arpey. "We continue to move through the most
challenging period in our history, and our success is still far
from assured, but reaching these cost-reduction agreements with our
suppliers, lessors, and creditors is another step forward and
further strengthens AMR as we seek to put the company on a solid
financial footing."
To Pay With Stock
In a move that's not really designed to lift the spirits of
AMR's present stockholders, AMR will issue up to three million
shares of common stock to suppliers, lessors, and other creditors
to enable them to share in the upside of the company's future in
return for their support of AMR's cost reduction efforts.
More News
States That Current Process is Damaging National Aerospace Development US Senator Jerry Morgan is pushing the FAA to speed up the process for rocket launch licensing. He argues tha>[...]
From 2015 (YouTube Edition): Model Aviator Aims For Full-Scale Career While at the 2015 Indoor Electric RC Festival, referred to as eFest, ANN CEO and Editor-In-Chief, Jim Campbell>[...]
Dave Juwel's Aviation Marketing Stories ITBOA BNITBOB ... what does that mean? It's not gibberish, it's a lengthy acronym for "In The Business Of Aviation ... But Not In The Busine>[...]
Aero Linx: Cardinal Flyers Online The Cardinal Flyers Online Web site was created and is maintained by me, Keith Peterson. My wife Debbie and I have owned a 1976 RG since 1985. Wit>[...]
Clearance Void If Not Off By (Time) Used by ATC to advise an aircraft that the departure release is automatically canceled if takeoff is not made prior to a specified time. The exp>[...]