American Airline Files Chapter 11 Bankruptcy

Posted by Kris | Wednesday, November 30, 2011 | | 0 comments »


Looks like another US airline casualty. Airline industry in the US is really a tough market to survive in. Nowadays, most US airlines charged a lot of miscellaneous fees if you are not observant enough. Long gone are the days of free privileges such as free 1 luggage check-ins.
As far as I know, the most profitable global airline industry should be Singapore Airlines which is holding cold hard cash in its war chest. And the service is rated as one of the best!! Changi Airport itself , IMHO is one of the best in the world in terms of environment & infrastructure.
And if you ever took US domestic flights, it can be the most uncomfortable experience as most US aircraft are NOT AirBuses like what you get in AirAsia. Some flights even use propeller planes like the Fokker. (something that seems to be very outdated as it was used widely during the 1970-80s). The seat space is very small even for an Asian man like me. It is no surprise that the Americans themselves are having a hard time seating themselves in!!

The AMR Corporation, the parent company of American Airlines, said on Tuesday that it had filed for bankruptcy protection in an effort to reduce labor costs and shed a heavy debt burden.
AMR was the last of the major legacy airline companies in the United States to file for Chapter 11. Analysts said that its reluctance to do so earlier had left it less nimble than many of its competitors.
The company had been in contract talks with its unions until the negotiations stalled earlier this month when the pilots’ union refused to send a proposal to its members for a vote. Because federal bankruptcy rules allow companies to reject contracts, AMR may take a harder negotiating stance with its unions.
“Achieving the competitive cost structure we need remains a key imperative in this process,” Mr. Horton said, “and as one part of that, we plan to initiate further negotiations with all of our unions to reduce our labor costs to competitive levels.”


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