American Airlines bankruptcy

[dennisr]

Not going to be a very friendly experience flying AA. Nothing new.
http://www.bloomberg.com/news/2011-...ion-in-new-york-as-talks-with-pilots-end.html

 

[TheBlackHand]

haha

This thread should be merged with the Aerolineas Argentinas thread.

 

[chris]

What about all my frequent flier miles?

 

[steveinbsas]

Frequent flyer miles are being honored...for the time being.

 

[ElLatingo]

Just got this heartwarming e-mail from American. Aw shucks, they really care about us:

Dear AAdvantage® Member,

As you may know, on Tuesday, November 29, American Airlines filed for reorganization under Chapter 11. We took this action as part of our efforts to secure our long-term success in delivering the highest standards in air travel. We are committed to meeting your travel needs with outstanding customer service and safety, and it will be business as usual at American throughout our reorganization process. More than 80,000 people at American appreciate your loyalty and look forward to continuing to serve you.

We want to assure you that your AAdvantage® miles are secure. The AAdvantage miles that you've earned are yours and will stay yours, subject to usual policies, until you choose to redeem them for a great award with us. Likewise, your elite qualifying miles and your elite status, including lifetime status granted under the Million MilerSM program is secure and remains intact. You will continue to earn miles through all our existing AAdvantage participating companies and you will be able to redeem those miles for the same great awards — flights, upgrades, car rentals and hotels just to name a few. And, throughout the coming year, we will be adding even more opportunities to earn miles, as well as new ways to redeem those miles.

American is honoring all tickets and reservations as usual, and making normal refunds and exchanges. And, we intend to maintain a strong presence in domestic and international markets. As we and all airlines routinely do, we will continue to evaluate our operations and service, assuring that our network is as efficient and productive as possible. Additionally, relationships with our oneworld Alliance and other codeshare partners are continuing to provide you with opportunities to earn and redeem miles for travel to hundreds of destinations worldwide, and we are honoring all tickets and reservations for travel on our partner airlines as usual. For information about American's reorganization process, please visit AA.com/restructuring.

Even more importantly, we remain committed to providing a superior customer experience with a focus on delivering what our customers value most — the newest fleet with our upcoming aircraft deliveries, network strength in the important cities of the world and world-class products, service and technology.

American Airlines has a proud history, and we will have a successful future. All of us on the American team thank you for your loyalty and we look forward to welcoming you aboard soon.

 

[glasgowjohn]

how many of you guys are going to redeem your ff miles as soon as possible...?

 

[citygirl]

I could be naive but every US airline has pretty much filed for bankruptcy and gone through a re-org in the last decade. I'm not really worried they're going away, just going to restructure.

Course if I lose my several hundred thousand FF miles, I'm going to be pissed!

 

[Davidglen77]

Relax everybody, Chapter 11 bankruptcy is a reorganization of debts. It's very convenient and smart for companies to do this if they've over extended themselves or see trouble brewing ahead. Some companies also do this so they can have a good excuse to ax a bunch of employees or demand salary reductions across the board. Chapter 11 is hardly a liquidation of a company, it's a great way to get the court to give you some breathing room to pay off debts, clean up house, and NOT a single one of your creditors can do ANYTHING ABOUT IT as the court decides when you will have to start paying back debts and with what terms. The creditors hate this because the court, depending on how liberal the judge is will many times let the company stay in the plan for years. Tough luck to the providers who are waiting to get paid, some go out of business as a result of a large clients Chapter 11 filing.

 

[Empshel]

My favorite line, from BadBanana on Facebook:

With American Airlines stock at 20 cents, I can't decide between paying for two checked bags or buying half the company.

 

[Napoleon]

Relax everybody, Chapter 11 bankruptcy is a reorganization of debts. It's very convenient and smart for companies to do this if they've over extended themselves or see trouble brewing ahead. Some companies also do this so they can have a good excuse to ax a bunch of employees or demand salary reductions across the board.

I just read the CNN report and this is what jumped out at me:

On Tuesday, Horton told CNN that bankruptcy "never has been a goal or preference."

He said that American is paying $800 million a year more in labor costs than it would be if it had labor contracts comparable to its competitors.

"Clearly it was our preference to do this in consensual fashion," he said. "Unfortunately, we were not successful in that regard." American will now gain significantly greater leverage in those talks given the bankruptcy court's power to void contracts.

Kaufman, the industry expert, said American needs contracts that would allow it the greater flexibility and lower staffing levels that other carriers have.

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

It's all about union-busting, being competitive. It's the same as with GM & Ford (I think they both did this, but not sure). If your fares are competitive and your operational costs are NOT, then something's gotta give.

Since AA miles are my tickets home, I sure hope that nothing happens with those.

Vamos a ver chicos, vamos a ver.