AA files for Chapter 11 Bankruptcy

[EZEtoGRU]

American Airlines filed for Chapter 11 this morning. They were one of the last remaining legacy carriers to not have gone through this process. Seems that CEO Gerard Arpey "retired" as well.

 

A sad day at AA....but not at all unexpected. They were very uncompetitive in labour costs and the unions were not willing to play ball.

 

AA indicate they are operating their flights normally.

[Guest Merlin]

They will just renegotiate some of their contracts and be out of bankruptcy fairly quickly. Bad for the unions, great for the lawyers. Our bankruptcy laws were drafted by lawyers and bankruptcy judges to maximize lawyers fees.

[instudiocity]

They will just renegotiate some of their contracts and be out of bankruptcy fairly quickly. Bad for the unions, great for the lawyers. Our bankruptcy laws were drafted by lawyers and bankruptcy judges to maximize lawyers fees.

 

Our bankruptcy laws were drafted by lawyers, lobbyists and CONGRESS. Bankruptcy Judges don't generally legislate.

[wayout]

So the question I have is whether or not the bankruptcy should in any way influence my travel planning? I am in the process of planning a vacation in January and am currently checking on prices for my flight. AA is a good option and within a few dollars of other airlines. I like the schedule with AA best but wondering now if I should go with another airline just in case, even though AA is saying they will operate normally.

[EZEtoGRU]

So the question I have is whether or not the bankruptcy should in any way influence my travel planning? I am in the process of planning a vacation in January and am currently checking on prices for my flight. AA is a good option and within a few dollars of other airlines. I like the schedule with AA best but wondering now if I should go with another airline just in case, even though AA is saying they will operate normally.

You should have no concerns about booking a trip with AA in January. It will be "business as usual" from a customer perspective. I plan to fly AA in January and February.

[KMEM]

This AA bankruptcy is just another way of screwing the pilots and other employees but not the executives. The stockholders will just have to wait and see. I don't really blame the board for taking this course of action allowed in the US but I do blame them for various acts done during such. Some pilots and other employees are overpaid and under worked but all of the executives are overpaid, whether overworked or not. Regardless of all that, AA more or less must take this action to remain competitive.

 

AA WILL continue to operate their normal schedule, at least for a time. Then, they will no doubt reduce flights, equipment and employees as well as benefits such as pension, etc. If you have a ticket/reservation, I am willing to state that it will be honored. However, I will not "guarantee" the future cost of tickets or perqs passed on to passengers. Not that "my" guarantee would be worth anything, anyway. The point being, if you have a ticket/reservation, I am very sure it will go as promised to the extent it does now or before now.

 

Best regards,

KMEM

[Cooper]

AA is not the first airline to file for Chapter 11 protection, some have emerged or have been acquired by others. Here are a few:

 

US Airways

United Airlines

Aloha Airlines

Air Canada

Delta Air Lines

Frontier Airlines

Japan Airlines

[Bosguy]

I am a little concerned because I already have trips planned to Chicago in January and Palm Springs in March. I have a substantial amount of Aadvantage miles--should I book using them now? There are also some fantastic bargains right now--book the now before the fares are increased and flght availability is reduced?

 

Thanks

Boston Bill

[instudiocity]

So the question I have is whether or not the bankruptcy should in any way influence my travel planning? I am in the process of planning a vacation in January and am currently checking on prices for my flight. AA is a good option and within a few dollars of other airlines. I like the schedule with AA best but wondering now if I should go with another airline just in case, even though AA is saying they will operate normally.

Your question could be stated as, "Why fly a bankrupt airline when I could fly an EMERGED-FROM-BANKRUPTCY airline?" Every other legacy airline has already reorganized through bankruptcy.

 

As to safety, between the FAA, the licenses of the pilots and mechanics, and the airline's desire to become profitable all point to working together for passenger safety.

[EZEtoGRU]

I am a little concerned because I already have trips planned to Chicago in January and Palm Springs in March. I have a substantial amount of Aadvantage miles--should I book using them now? There are also some fantastic bargains right now--book the now before the fares are increased and flght availability is reduced?

 

Thanks

Boston Bill

I wouldnt be concerned if I were you. Your mileage bank is safe. You should feel confident with any trips already booked on AA or in booking new travel.

[Romann]

Unions be warned... negotiate or allow the courts to make their mark.

 

I have a substantial amount of Aadvantage miles--should I book using them now? There are also some fantastic bargains right now--book the now before the fares are increased and flght availability is reduced?

 

According to the news and from PR statements released by American Airline and its parent company (the name is escaping me at the moment) it will be "business as usual" with the airline and there are no expected (whatever that is supposed to mean) delays in travel, flights, luggage and destinations. This choice to follow suit with the best of them is more of an attempt to place controls on cost associated with labor specifically which seems to be quite high due to failed union negotiations recently but also in the past as well.

 

It's a sign of the times. Negotiate and make concessions... or risk allowing the courts to make their mark which is never good for either parties involved. Personally, I think this is a good move the airline is making and one that shouldn't be surprising. This seems to be all part of an overall budget overall which has been going on for a couple years now and further driven by the new fleet that is already on the production lines.

[Kevin Slater]

I have a substantial amount of Aadvantage miles--should I book using them now?

 

Your miles are safe: they're an asset to the firm, not a liability. Think of the mileage program as a highly desired rolodex. AA won't fuck with that customer loyalty. Even if it were to cease operations, someone else would gladly pick the miles up and honor them, as Delta did when Pan Am went under.

 

Kevin Slater

[instudiocity]

It's a sign of the times. Negotiate and make concessions... or risk allowing the courts to make their mark which is never good for either parties involved. Personally, I think this is a good move the airline is making and one that shouldn't be surprising. This seems to be all part of an overall budget overall which has been going on for a couple years now and further driven by the new fleet that is already on the production lines.

Quite INSIGHTFUL Romann. Effectively, the company that emerges from bankruptcy is a whole new company with a whole new set of union contracts as well as aircraft leases. It's like taking a shower after long day of laboring. In this example, if you don't keep yourself bathed, someone with a fire hose will take care of it eventually.

 

Government workers, whose earnings maybe equal to the private sector have far more elaborate retirement and benefit packages. They'd better negotiate, or the legislature that passed the benefits will take them away, a la Wisconsin.

[KMEM]

AMR is the parent company's name. Miles are not as asset but a liability but they will be honored, I am sure.

 

Best regards,

KMEM

[+ glutes]

AMR stock went down nearly 84% in one day??? Not comforting folks...

 

 

Last Trade: 0.26

Trade Time: 4:00PM EST

Change: 1.36 (83.95%)

Prev Close: 1.62

Open: 0.65

Bid: 0.31 x 292600

Ask: 0.30 x 2000

1y Target Est: 4.86

[Romann]

AMR stock went down nearly 84% in one day??? Not comforting folks...

 

Turn that frown upside down... this could certainly be a good opportunity to buy into a major player. Sounds like an investment opportunity.

[instudiocity]

Turn that frown upside down... this could certainly be a good opportunity to buy into a major player. Sounds like an investment opportunity.

I wouldn't be trading stocks of a bankrupt company. One of the risks of stock ownership is you can lose your total investment. In theory, common stockholders are the last to get paid in a bankruptcy. Bondholders have a higher claim to being paid. But once a company is in bankruptcy, your ability to retain your equity in the company comes at the caveat of the judge and the bankruptcy trustee.

[orbital sander]

AMR stock went down nearly 84% in one day??? Not comforting folks...

 

 

Last Trade: 0.26

Trade Time: 4:00PM EST

Change: 1.36 (83.95%)

Prev Close: 1.62

Open: 0.65

Bid: 0.31 x 292600

Ask: 0.30 x 2000

1y Target Est: 4.86

 

Actually AMR stock was "not comforting" for quite a while before today...This bankruptcy has been coming for a while. It is not a good time to invest now, but once they emerge from bankruptcy the new stock might be interesting.

[Kevin Slater]

...once they emerge from bankruptcy the new stock might be interesting.

 

My dread fear is owning stock in a corporation whose most significant cost factors include a unionized workforce and the price of oil. To quote Warren Buffett, "Any right-minded capitalist who had seen the Wrights' contraption take to the skies in Kitty Hawk might have shot it down and saved investors 100 years of agony."

 

Kevin Slater

[orbital sander]

My dread fear is owning stock in a corporation whose most significant cost factors include a unionized workforce and the price of oil. To quote Warren Buffett, "Any right-minded capitalist who had seen the Wrights' contraption take to the skies in Kitty Hawk might have shot it down and saved investors 100 years of agony."

 

Kevin Slater

 

He he he...that is too funny, and probably true for the long haul, however, there could be some short term benefits.

[leigh.bess.toad]

I've spent a good part of today looking at flights to PS and AA may be the best options. I'm not too worried about whether they will emerge from bankruptcy since quite a few other major carriers have done it and emerged. I guess the question is what it may do to their flight schedule. Is there a chance if I book flights that the flights could be cancelled in a cost-restructuring plan. I'm certain the money spent would be okay but by delaying booking on another carrier if a revised flight schedule is less desirable, is there any danger in flight schedules being changed? TIA

[orbital sander]

I've spent a good part of today looking at flights to PS and AA may be the best options. I'm not too worried about whether they will emerge from bankruptcy since quite a few other major carriers have done it and emerged. I guess the question is what it may do to their flight schedule. Is there a chance if I book flights that the flights could be cancelled in a cost-restructuring plan. I'm certain the money spent would be okay but by delaying booking on another carrier if a revised flight schedule is less desirable, is there any danger in flight schedules being changed? TIA

 

 

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.

 

Sincerely,

 

 

Maya Leibman

President — AAdvantage Loyalty Program

[KMEM]

There is ALWAYS a danger of a flight schedule being changed which may or may not have anything to do with bankruptcy. However, A flight will go to where ever you are traveling or they will book you on another airline if they cancel a city altogether. The "new" time might not be convenient but you will get there. That is no different from how all the airlines operate now.

 

If anyone thinks AA stock in its' present form is a good buy, I have some "previous" stock in UA I will sell cheap. It became worthless paper or I should say worthless electrons during the process of UA going through bankruptcy.

 

Best regards,

KMEM

[orbital sander]

 

If anyone thinks AA stock in its' present form is a good buy, I have some "previous" stock in UA I will sell cheap. It became worthless paper or I should say worthless electrons during the process of UA going through bankruptcy.

 

Lol...you crack me up!

My uncle still talks about his ATT stock that he invested heavily in after they broke up the bells!

[CowboyUp]

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