Official: AMR Bankrupt

[Wretched Wrench]

Yup. What I expected.

 

[TWU informer]

What would you have done differently?

Would you have flown MD-80s at a loss even though AA was acquiring new, fuel efficient 738s? New 738s where the fuel cost savings probably covered their own lease payments plus the lease payments on the old MD-80s? Could be that the MD-80s were due for heavy C checks that might cost a couple million per plane. Would you have wasted a couple million dollars each to overhaul them and then flown them on money-losing flights?

As others have said, sometimes the best alternative involves spending some money to save a lot of money (or to minimize the losses).

AA is likely to reject many of the leases so that it can either abandon the aircraft or renegotiate the lease rates. That's what airlines do in bankruptcy.

How about not getting yourself in that stupid position on your lease agreements to begin with?
Like a little bit of planning before you sign leases that will leave you with aircraft you don't need for years sitting in a desert.
This airline used to be ran on 15-20 year projections and had awesome forward thinking and future planning, now they don't know what will happen next month.
They don't plan, they sit around and react. My first 15 years at AA, management communicated the plans and were leaders in this industry.
Now we have sons, daughters, or relatives of those employees running the show and they wait for other airlines to lead and then react to that.

And based on Chapter 11 filing and company news, are not most aircraft flying at a loss?

 

[nbmcg01]

How about not getting yourself in that stupid position on your lease agreements to begin with?
Like a little bit of planning before you sign leases that will leave you with aircraft you don't need for years sitting in a desert.
This airline used to be ran on 15-20 year projections and future planning, now they don't know what will happen next month.
They don't plan, they sit around and react.

And based on Chapter 11 filing and company news, are not all aircraft flying at a loss?

Why do you think AA filed in NY? I thought most corporate bks were filed in Delaware. And why haven't the "powers that be" been planning so that a pre-pack could have been filed?

I agree with RC, the entire BOD should be replaced. Also as creditors now is the time to get representatives from the unions on the BOD.

 

[767jetz]

Yup. What I expected.

Yup. By the response of others, looks like you are what we all expected.

 

[WorldTraveler]

How about not getting yourself in that stupid position on your lease agreements to begin with?
Like a little bit of planning before you sign leases that will leave you with aircraft you don't need for years sitting in a desert.
This airline used to be ran on 15-20 year projections and had awesome forward thinking and future planning, now they don't know what will happen next month.
They don't plan, they sit around and react. My first 15 years at AA, management communicated the plans and were leaders in this industry.
Now we have sons, daughters, or relatives of those employees running the show and they wait for other airlines to lead and then react to that.

And based on Chapter 11 filing and company news, are not most aircraft flying at a loss?

and what would a 10 year plan for ANY airline have looked like as of, oh say, Aug 1, 2001? The 2000s have been one of the most turbulent periods economically in the history of the western world and airlines are ALWAYS the first to feel the pain.
.
Given that US rejected, what did he say, hundreds of non-operating planes on the 2nd day of BK, perhaps AA really doesn't have that many unused assets sitting around. EVERY airline has rejected leases in BK.
Keep in mind that the majority of the F100s and 300s ARE GONE - off AA's books... but there obviously were a few leases that were longer term and from which AA could not extricate itself. It is to your benefit to stagger leases so they don't all come due at the same time. The real concern w/ AA's huge fleet order is they will be fighting a huge replacement cycle spread over just 5 years to replace a huge portion of its fleet.
,
Remember the cost cuts have to come from somewhere. You would FAR rather they come from physical assets than from human resources.
This could be a great opportunity for AA to clean up its books of all the clutter that has been
.
The real question is how well AA can dovetail its need to cut its long-term commitment to major parts of its fleet w/ its need to preserve the structure of the airline NOW until the new airplanes start arriving.
.
It is still very likely that there will be lease rejections by Jan 31 that WILL affect the operating fleet and will take significant portions of AA's capacity out of service. Given that there are a couple dozen new aircraft coming in 2012, there will be at least that many ACTIVE aircraft removed from the fleet and probably a lot more. .
It is precisely because AA is losing money that they must cut money losing routes now and worry about growing the airline after it is stable.

 

[TWU informer]

Why do you think AA filed in NY? I thought most corporate bks were filed in Delaware. And why haven't the "powers that be" been planning so that a pre-pack could have been filed?

I agree with RC, the entire BOD should be replaced. Also as creditors now is the time to get representatives from the unions on the BOD.

I am not sure but I suspect this was filed in this manner because it is a "strategic bankruptcy".
In other words the full use of the law for unintended purposes and not an absolute required bankruptcy.

Probably why Arpey was against this and retired. While not much of an industry leader, he might have more values within him as a person rather than the other snakes that use all tools available to rape and pilferage the working stiff.

Airline A = Get pays and benefit cuts and starts a fare war.
Airline B = matches the pay and benefit cuts and ends the war.
Airline C = uses bankruptcy laws to obtain pay, benefit, work rule cuts.
Airline A = returns to the employee group and ask for more cuts to compete
Airline B = Outsource jobs to reduce cost and match Airline C
Airline C = suffers an employee strike, mergers with another carrier.

And so it begins again, return to first Airline A above and repeat cycle.

Now they piss off customers by having listed prices that are low, and then charge bag fees and other fees and many customers never return. So Airline B has simple no fee pricing and runs advertisements against the fees, wining over many customers. Airline A and C keep shafting the workers and customers....

....On and On

 

[TWU informer]

and what would a 10 year plan for ANY airline have looked like as of, oh say, Aug 1, 2001? The 2000s have been one of the most turbulent periods economically in the history of the western world and airlines are ALWAYS the first to feel the pain.
.
Given that US rejected, what did he say, hundreds of non-operating planes on the 2nd day of BK, perhaps AA really doesn't have that many unused assets sitting around. EVERY airline has rejected leases in BK.
Keep in mind that the majority of the F100s and 300s ARE GONE - off AA's books... but there obviously were a few leases that were longer term and from which AA could not extricate itself. It is to your benefit to stagger leases so they don't all come due at the same time. The real concern w/ AA's huge fleet order is they will be fighting a huge replacement cycle spread over just 5 years to replace a huge portion of its fleet.
,
Remember the cost cuts have to come from somewhere. You would FAR rather they come from physical assets than from human resources.
This could be a great opportunity for AA to clean up its books of all the clutter that has been
.
The real question is how well AA can dovetail its need to cut its long-term commitment to major parts of its fleet w/ its need to preserve the structure of the airline NOW until the new airplanes start arriving.
.
It is still very likely that there will be lease rejections by Jan 31 that WILL affect the operating fleet and will take significant portions of AA's capacity out of service. Given that there are a couple dozen new aircraft coming in 2012, there will be at least that many ACTIVE aircraft removed from the fleet and probably a lot more. .
It is precisely because AA is losing money that they must cut money losing routes now and worry about growing the airline after it is stable.

You sound just like a President blaming the previous administration and someone else for all his own generated problems.

How many years does 9/11 and what other arilines have done buy a group of dumbasses anyway? Or does the blame go on forever or until you cease to exist? By the way, you left out the TWA aquisition, didn't that cause some of this? Who is to blame for that?

 

[Bob Owens]

You sound just like a President blaming the previous administration and someone else for all his own generated problems.

How many years does 9/11 and what other arilines have done buy a group of dumbasses anyway? Or does the blame go on forever or until you cease to exist? By the way, you left out the TWA aquisition, didn't that cause some of this? Who is to blame for that?

They expect to be treated like gods but excused for their human fallibilities. They screw up and they expect us to pay for it.

 

[Bob Owens]

I am not sure but I suspect this was filed in this manner because it is a "strategic bankruptcy".
In other words the full use of the law for unintended purposes and not an absolute required bankruptcy.

Probably why Arpey was against this and retired. While not much of an industry leader, he might have more values within him as a person rather than the other snakes that use all tools available to rape and pilferage the working stiff.

Airline A = Get pays and benefit cuts and starts a fare war.
Airline B = matches the pay and benefit cuts and ends the war.
Airline C = uses bankruptcy laws to obtain pay, benefit, work rule cuts.
Airline A = returns to the employee group and ask for more cuts to compete
Airline B = Outsource jobs to reduce cost and match Airline C
Airline C = suffers an employee strike, mergers with another carrier.

And so it begins again, return to first Airline A above and repeat cycle.

Now they piss off customers by having listed prices that are low, and then charge bag fees and other fees and many customers never return. So Airline B has simple no fee pricing and runs advertisements against the fees, wining over many customers. Airline A and C keep shafting the workers and customers....

....On and On

You left out one important part;

Airline A = Get pays and benefit cuts and starts a fare war.
Operations Normal
Airline B = matches the pay and benefit cuts and ends the war.
Operations Normal
Airline C = uses bankruptcy laws to obtain pay, benefit, work rule cuts.
Operations Normal
Airline A = returns to the employee group and ask for more cuts to compete
Operations Normal
Airline B = Outsource jobs to reduce cost and match Airline C
Operations Normal
Airline C = suffers an employee strike, mergers with another carrier.
Operations Normal


And the cycle will continue until operations are no longer normal. We need to do like the workers in England did.

 

[Bob Owens]

Some times its cheaper to park them instead of fly them. That would be worth a bonus by minimizing the loss. If you were in the market for your own jet Horton could probably get you a good deal.

Forever the apologist for management.

 

[WorldTraveler]

You sound just like a President blaming the previous administration and someone else for all his own generated problems.

How many years does 9/11 and what other arilines have done buy a group of dumbasses anyway? Or does the blame go on forever or until you cease to exist? By the way, you left out the TWA aquisition, didn't that cause some of this? Who is to blame for that?

no, I am blaming NO ONE. But the key is not to have a solid 10 year plan but have the FLEXIBILITY to adapt to the very rapid changes that have happened in the global economy.
I believe AA has failed because it was far too inflexible and too slow to adapt to the changes in the industry.
.
As for the notion that AA's filing was a strategic BK, AMR did not file because it was good for the industry. They filed because they saw no chance of restoring the company under the current environment and legally AMR does have an obligation to also protect the interests of the creditors. Continuing to burn the furniture when they could have filed and ended the losses to the creditors could have exposed AMR to significant legal problems.
.
Yes, it is very likely that the size of concessions AA will get from labor will influence wage rates and workrules throughout the industry and some of AA's competitors - UA particularly which is trying to merge workgroups under new contracts - are happy to see wages being pushed down. But the notion that any company files for the benefit of its competitors is not accurate. Do others benefit at times from your actions? yes. Do you do things that are good for you but better for someone else? No

 

[TWU informer]

Eventually the P.R. Campaign and the hired internet blogger's stories don't match!

There are no doubt 3 (three) hired bloggers on this bulletin board. No need to name them, it is obviuos.

American Airlines' parent company is filing for bankruptcy. But AMR Corp.'s new CEO Tom Horton said the company is not completely out of cash; instead, he says it's a strategic move.

Horton on "Strategic Move" Bnakruptcy

 

[Hopeful]

Eventually the P.R. Campaign and the hired internet blogger's stories don't match!

There are no doubt 3 (three) hired bloggers on this bulletin board. No need to name them, it is obviuos.



Horton on "Strategic Move" Bnakruptcy

Stategic my ass.....this is about force feeding labor agreements to get everything the company wants...No great shakes here.

 

[TWU informer]

Stategic my ass.....this is about force feeding labor agreements to get everything the company wants...No great shakes here.

Um, that is the "STRATEGY"

And they have all the marbles.

 

[Dilligas]

Um, that is the "STRATEGY"

And they have all the marbles.

The judge will give the company all of the things they could not obtain at the bargaining table, and the company will ask for even more than they ever did at the table. It is a horrible process for labor and you will be slammed.

The judge has no duty of "fairness" to the employees.

The judge is there to protect the interests of the creditors.

Your head will spin when you see what the company requests be done to your contract, they will ask for so much that the union will never agree to it, and then the company will request that the judge abrogate your contract.

Throw out all of your preconceptions of fairness, or reasonable give and take. This is an entirely new ballgame and you (labor) are playing with both hands tied behind your back. Every line of your contract and things you took for granted for years is in play, and it will really piss you off all the little things they take away along with the biggies like pay, scope, vacation, pensions, medical, etc.

I'm not trying to beat you guys up, just sharing the facts of life with you so you can prepare yourself mentally and financially if possible.

Basically, all you can do is ride it out. I've been down this road before and it sucks royally. Good luck to you all.

Respectfully,

D