AMR Not Out of The Woods Yet | Aero-News Network
Aero-News Network
RSS icon RSS feed
podcast icon MP3 podcast
Subscribe Aero-News e-mail Newsletter Subscribe

Airborne Unlimited -- Most Recent Daily Episodes

Episode Date

Airborne-Monday

Airborne-Tuesday

Airborne-Wednesday Airborne-Thursday

Airborne-Friday

Airborne On YouTube

Airborne-Unlimited-10.28.24

Airborne-NextGen-10.29.24

Airborne-Unlimited-10.30.24

Airborne-Unlimited-10.24.24

Airborne-Unlimited-10.25.24

Fri, May 16, 2003

AMR Not Out of The Woods Yet

Success 'Still Far From Assured'

Although much of the latest news for AMR, parent of American Airlines, has been reasonably good -- concessions from major unions, concessions from creditors, concessions from leaseholders, financing arrangements' coming into place -- the airline may still find that its interests are better-served from behind the curtain of bankruptcy protection, the new CEO, Gerard Arpey (below), said Thursday.

He didn't use those exact words, of course. What he said was, "We continue to move through the most challenging period in our history, and our success is still far from assured."

That "challenging period" is the post-911 period, when travel has become a hassle for business types and an undesired risk for vacationers; when fuel prices have risen, and stayed relatively high; when a war in Iraq slowed things down; and when a little-understood and deadly virus has captured the imaginations of national press and international health organizations.

In other words, costs are still pretty high -- and revenues are pretty low.

Chapter 11, from the airline's point of view, carries a lot of advantages, most-especially the ability to ignore existing debt while negotiating it down to pennies; and the ability to walk away from unprofitable contracts -- with labor, especially. Chapter 11 reorganization allows a real 'reorganization' -- witness US Airways, remaking itself into a big user of regional jets, after negotiating many creditors down to 2¢ on the dollar, and transitioning many pilots (and their pay scales) to CRJs from 757s.

The reorganization has to come -- whether it is through natural processes (a few airlines go out of business or merge) or the unnatural act of maintaining court-enforced industry overcapacity, until virtually every airline is forced to stiff its creditors, downsize its workforce, and renegotiate its contracts -- from those with ramps and gates, to employees.

FMI: www.amrcorp.com

Advertisement

More News

Senator Pushes FAA to Accelerate Rocket Launch Licensing

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>[...]

Classic Aero-TV: RJ Gritter - Part of Aviation’s Bright New Future

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>[...]

Aero-FAQ: Dave Juwel's Aviation Marketing Stories -- ITBOA BNITBOB

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>[...]

ANN's Daily Aero-Linx (10.27.24)

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>[...]

ANN's Daily Aero-Term (10.27.24): Clearance Void If Not Off By (Time)

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>[...]

blog comments powered by Disqus



Advertisement

Advertisement

Podcasts

Advertisement

© 2007 - 2024 Web Development & Design by Pauli Systems, LC