mass production Posted November 29, 2011 Share #1 Posted November 29, 2011 American Airlines' parent company AMR Corp. has filed for Chapter 11 bankruptcy reorganization, the company said Tuesday, in an attempt to get costs and debt under control."American expects to continue normal business operations throughout the reorganization process, and the business will continue to be operated by the company's management," AMR said in a statement. The nation's third-largest airline said it would be operating normal flight schedules and honoring tickets, as usual, during the process. It added its frequent flyer program is not affected. AMR said it took the action so that it could "achieve a cost and debt structure that is competitive in the airline industry." Many of American's rivals have filed for bankruptcy reorganization over the past decade to address issues with debt and costs, especially labor and fuel costs. Reuters reported that wages and benefits for AMR's union workers are higher as a percentage of operating expenses than at its rivals. American is the only major airline that still must fund its workers' pensions. Reuters said AMR listed assets of about $24.72 billion and liabilities of $29.55 billion. The company said it has $4.1 billion in cash. "This was a difficult decision, but it is the necessary and right path for us to take - and take now - to become a more efficient, financially stronger, and competitive airline," AMR CEO Thomas W. Horton said in a statement. Horton was named CEO Tuesday, succeeding the company's long-time chief executive Gerard Arpey, who told the company's board Monday that he would retire. "But as we have made clear with increasing urgency in recent weeks, we must address our cost structure, including labor costs, to enable us to ... secure our future," Horton added. Bottom Line - American Airlines files for bankruptcy protection Link to comment Share on other sites More sharing options...
BZGuy Posted November 29, 2011 Share #2 Posted November 29, 2011 Wow I was hoping they would be the ones that held out and made it without filing but with practically everybody else going Chap.11 and the mergers, the deck was stacked against them. I wish AA the best....I just hope Parker and USAirways keeps their grubby paws to themselves. Link to comment Share on other sites More sharing options...
Shortline Bus Posted November 29, 2011 Share #3 Posted November 29, 2011 This is a long downward fall for AA. Just as late as 15-20 years ago, they were not only the best US-owned airlines but among the best in the planet. Before low cost carriers came along i.e Jetblue, US Airways and Southwest to visit my family in Southern Calif.I would reguarly use AA. I also hope they get out of this crisis but more times than chap. 13 is the last rites for a business before they either merger, or go to chap. 7 and go out of business for good. Link to comment Share on other sites More sharing options...
TheKorean Posted December 2, 2011 Share #4 Posted December 2, 2011 They will be fine, United and US Airways and Delta all went bankrupt before. Its only Chapter 11. Sucks for those who loses their jobs though, really sucks for them in this economy. Link to comment Share on other sites More sharing options...
Shortline Bus Posted December 2, 2011 Share #5 Posted December 2, 2011 They will be fine, United and US Airways and Delta all went bankrupt before. Its only Chapter 11. Sucks for those who loses their jobs though, really sucks for them in this economy. My bad. I mistyped again and said chap. 13. It was chap. 11 that AA filed under the other day. Link to comment Share on other sites More sharing options...
East New York Posted December 2, 2011 Share #6 Posted December 2, 2011 American was the only major US carrier to not file or be absorbed after 9/11. I really thought they would be able to steer clear. However, I do think they would be in a better position had they decided to file in 2008 or 2009. Link to comment Share on other sites More sharing options...
BZGuy Posted December 3, 2011 Share #7 Posted December 3, 2011 They will be fine, United and US Airways and Delta all went bankrupt before. Its only Chapter 11. Sucks for those who loses their jobs though, really sucks for them in this economy. I don't know about that. Alot of loopholes have gotten closed, it's gotten significantly harder to come out of Chapter 11 intact. Honestly if they were gonna do this they should have done it when Delta and NWA did it. Like I said I thought they would be the ones to pull through without having to declare. On another note, I'm a bit disappointed with Arpey. Even with the bk filing he's leaving with his golden parachute. Considering that his employees have agreed to large give backs (not to mention the screwing they are gonna get in BK court), he should have turned that money down. Link to comment Share on other sites More sharing options...
Nova RTS 9147 Posted December 3, 2011 Share #8 Posted December 3, 2011 American was the only major US carrier to not file or be absorbed after 9/11. I really thought they would be able to steer clear. However, I do think they would be in a better position had they decided to file in 2008 or 2009. Its amazing they lasted as long as they did given their high operations cost. I believe theyll still be strong once this is over, provided no one on the top or bottom does anything stupid. Link to comment Share on other sites More sharing options...
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