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American Airlines files for bankruptcy

Quote:

NEW YORK (CNNMoney) -- American Airlines parent AMR, one of the few major U.S. airlines to avoid bankruptcy, finally succumbed Tuesday and filed for chapter 11.

AMR said that all of its subsidiaries will honor tickets and reservations and operate normal flight schedules during the bankruptcy process.

The airline also announced that Gerard Arpey, its chairman and CEO, is retiring. He is being succeeded by Thomas Horton, who said at a press conference that Arpey had opposed the bankruptcy filing.

In an interview with CNN's Richard Quest, Horton said the airline was forced into bankruptcy because of cost disadvantages it faced compared to rivals that had already gone though bankruptcies.

http://money.cnn.com/2011/11/29/news....htm?hpt=hp_t2

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AMR has its headquarters in Fort Worth, so it's been all over the news here

Everyone knew this was coming. I'm just wondering what this does for their recent large order of Boeing and Airbus planes to reinvigorate their fleet.

Quote:

Originally Posted by PeppyGPhiB (Post 2109316)

Everyone knew this was coming. I'm just wondering what this does for their recent large order of Boeing and Airbus planes to reinvigorate their fleet.

From what I'm hearing from insiders, nothing much.

This was widely anticipated among employees, many whom were working to get transfers between AA and American Eagle approved before Thanksgiving. There was also a large wave of pilot retirements ahead of the anticipated announcement so that retirement would be grandfathered under the old plan since the speculation is that it's being done to bust up the union contracts.

I don't anticipate the regular flyers will see much that looks different - there have been a lot of program changes over the last year or so under the new(er) AAdvantage program VP. Most were projected 1-2 years out (like the change to the Million Miler program) and I think most are positive for the health of the airline.

There will no doubt be some noticeable changes at certain non-hubs (switches from mainline to Eagle or changes in staff contracts) and reevaluation of fares, frequencies, etc. just like United did after their Ch 11. And many have been predicting the de-hubbing of St. Louis for quite some time. But most if it I think will be what we frequent flyers have gotten used to since 9/11.

Quote:

Originally Posted by PeppyGPhiB (Post 2109316)

Everyone knew this was coming. I'm just wondering what this does for their recent large order of Boeing and Airbus planes to reinvigorate their fleet.

My thought exactly.

I got this in my e-mail:
http://a6.sphotos.ak.fbcdn.net/hphot...01024317_n.jpg

Per the bolded, I recommend to all of my clients not to horde frequent flyer miles, hotel points, credit card points, whatever. They are assuring you they're safe. Spend them as soon as you can because when/if they decide to pull the plug, or more likely change the spendability or value of them, you'll be outta luck. They'll say it will now take 100,000 miles to go from Chicago to St. Louis, but you've got time! You can pay with miles under the old limits for the next 60 days for travel within the next 3 months. If you've ever tried to use those miles, you can imagine that being a nightmare ending in failure. If you've got enough for a ticket to somewhere good, go! Don't wait for a rainy day, or to get one level higher so you can do x or y thing with it.

I do not trust the airlines and if I'm owed something from them (forgetting the 15 years of marketing I do on their behalf as a travel agent that I don't get paid for) I'm going to make sure I get it as soon as possible.

/steps off high horse