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AA (American Airline) filed Chapter 11 today, 11/29/2011

I would not worry. Their press releases, analysis by financial "experts" and an email I got says everything will remain the same (assuming no strikes). That was my experience when all the other majors went bust and I see no reason to think it will be different with AA.

Basically it is just a way to break labor and other contracts that could not be renegotiated in line with DL, UA, etc who went Chapter 11 before AA.

Cheers
 
There should be no problems

As skier mentioned, you should not have any problems with using miles or any other perks and services from AA. Again, as skier said, this action was to re-origanize financial issues. I heard on the news this morning there is absolutely no reason to think AA is going away as they still intend to order hundreds of new aircraft.
 
That's my understanding, too. Chapter 11 is no big deal to customers. Stockholders and union employees will feel the brunt of it.
 
Ironic that the headlines a few days ago in Denver were, "Airlines make huge profits on baggage fees," and the articles went on to say the airlines are doing well because of the added fees. Not so, apparently.

With fuel costs so high, I would bet a lot of people are rethinking vacation and doing the math on driving to Grandma's, instead of flying to the Bahamas. There is rhyme in there somewhere.
 
I've been through this with United with no repercussions to my miles and flights. Most large U.S. airlines have been through chp. 11 and are still going.
 
The AA website has this banner on it:

"American Airlines is flying normal schedules and conducting business as usual worldwide. Additional information about the Chapter 11 reorganization is available at www.aa.com/restructuring."


I also received an email from AA this morning stating that everything that exists will continue to exist and be honored in the normal fashion. I did a test-booking of a ticket combining miiles and cash, and everything showed up as i expected it to. So for now it seems everything is good.

Dave
 
I have actually been expecting this for some time. They are the only major airline NOT to have filed for Chapter 11. The refi will put them in a more equal footing with their competitors, by restructure some debt and renogot some of their contracts with unions.
 
Sandy Lovell said:
I have actually been expecting this for some time. They are the only major airline NOT to have filed for Chapter 11. The refi will put them in a more equal footing with their competitors, by restructure some debt and renogot some of their contracts with unions.
Click to expand...

Out of every dollar American Airlines takes in, 32% goes to pay for personnel costs while the industry average is 21%. Yet, they only pay 2% above the industry average. Does that hint at poor management?
Their pension fund only covers half of its liabilities and is underfunded by 7 billion dollars.
The ones who will take the hit are the former employees and stock holders.
 
The ONLY reason AA filed bankruptcy is simply this; the Union ALPA has been in negotiations with AA for years over a new Pilot contract. AA is wanting the pilots to give up their pension fund and take 25% pay cuts. The pilots don't want this.

Over 6 months ago AA threatened the Pilot group with Bankruptcy if they didn't accept the "new contract". Pilots said no and have been negotiations ever since. This is a strategic move by AA to leverage the pilots into a 25% pay cut and removal of pension funds.

Bankruptcy courts don't care about the lively hood of the pilots....
This bankruptcy will dissolve an previous negotiations and leave the pilots high and dry.

Shame on AA.
 
Dzalumni said:
The ONLY reason AA filed bankruptcy is simply this; the Union ALPA has been in negotiations with AA for years over a new Pilot contract. AA is wanting the pilots to give up their pension fund and take 25% pay cuts. The pilots don't want this.

Over 6 months ago AA threatened the Pilot group with Bankruptcy if they didn't accept the "new contract". Pilots said no and have been negotiations ever since. This is a strategic move by AA to leverage the pilots into a 25% pay cut and removal of pension funds.

Bankruptcy courts don't care about the lively hood of the pilots....
This bankruptcy will dissolve an previous negotiations and leave the pilots high and dry.

Shame on AA.
Click to expand...

Supposedly another angle on the filing, along with the above, is AA has wanted to merge with U S Airways and will argue the merger will make both companies more fiscally sound.
 
Sounds familiar

california-bighorn said:
Supposedly another angle on the filing, along with the above, is AA has wanted to merge with U S Airways and will argue the merger will make both companies more fiscally sound.
Click to expand...

The airlines today look like the passenger railroads did in 1970. Maybe the US government will nationalize all the bankrupt passenger airlines and call them Amwing.
 
california-bighorn said:
Out of every dollar American Airlines takes in, 32% goes to pay for personnel costs while the industry average is 21%. Yet, they only pay 2% above the industry average. Does that hint at poor management?
Their pension fund only covers half of its liabilities and is underfunded by 7 billion dollars.
The ones who will take the hit are the former employees and stock holders.
Click to expand...

Often those unnecessary extra employees are mandated by union contracts. Like on the railroads, where diesel locomotives were still required by union contracts to carry firemen (the guys who shoveled the coal into the boiler). Bankruptcy is a good way to rationalize employee structures.

AA's pension fund sounds a lot like other airlines pension funds before they went into bankruptcy.

AA should have done this back when the other US legacy airlines were doing it.
 
Last edited:
california-bighorn said:
Supposedly another angle on the filing, along with the above, is AA has wanted to merge with U S Airways and will argue the merger will make both companies more fiscally sound.
Click to expand...


This is close to the end of the world as we know it. :eek:

Cheers
 
I couldn't imagine any bigger mismatch than Southwest and AirTran, but AA and US Airways might come close.
 
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