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American to cut 7,000 jobs.

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What happens now?
Jan 14, 2002

American cuts 7,000

Airline undertakes job cuts, fleet simplification to reduce costs and capacity.
August 13, 2002: 6:56 AM EDT

NEW YORK (CNN/Money) - American Airlines said Tuesday it would cut 7,000 jobs by next March and reduce its capacity 9 percent by November.

"We must get our costs down in order to compete and must focus on the products our customers want and are willing to pay for. Our decisions going forward will be framed around those objectives and geared toward positioning American to succeed and be profitable," Chairman and CEO Donald J. Carty said in the company's announcement.

AMR Corp. (AMR: Research, Estimates), the corporate parent of American, the world's largest airline, closed down $1.23 at $8.36 on Monday in the wake of US Airways Group (U: Research, Estimates)'s bankruptcy filing Sunday.

Airlines' business has been hammered in since Sept. 11 when many people stopped or sharply cut back on flying because of fears of additional terrorist attacks and the recession that followed.

As part of the cost reduction effort the airline is trying to reduce the number of different makes and models of aircraft in its fleet. It will retire its 74-jet Fokker fleet, defer delivery of 35 aircraft in 2002, and work to standardize the various models of Boeing aircraft in its fleet. The airline hopes the simplification will allow it to schedule, substitute and maintain aircraft more easily.

American also said it plans to reduce capacity by 9 percent by November amid worrisome economic and consumer news. Part of that reduction includes accelerating the retirement of its nine TWA 767-300 aircraft to November.

Employees affected by the job cuts will be notified once the new October and November schedules are in place. The cuts will be made through a combination of voluntary programs, leaves and part-time schedules. The reductions are expected to save American more than $1.1 billion annually, the company said.

The fleet changes are further expected to save more than $1.3 billion in capital spending in the future. American has already cut or deferred an additional $5 billion in capital spending since early 2001.

American, which said it ended the second quarter with $2.6 billion in cash, expects the changes announced Tuesday to boost liquidity. The company said it has "significant" untapped financing, including several billion in both aircraft and non-aircraft assets. In July, American completed a $500 million tax-exempt financing at John F. Kennedy International Airport in New York, further adding to its cash balances.

Great. Just great.
Funny how rumors tend to come to fruition in the airline industry...

Does anyone know how many pilots per plane American uses?
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Pilot furloughs:

100 on October 13 (that includes me)
100 in November
"up to" 550 total in subsequent months
"Early out" package available to 480 ex-TWA pilots. Some releases said the early-outs were in addition to the 550 but that doesn't make sense. No way all 480 are gonna take it anyway.

All the announced furloughs are ex-TWA pilots. They anticipate few if any displacements within the AA system.

And the weather in the Midwest is sh1tty today.
Sorry to hear that! Join the club.:(
What does this do to flow-back?

For you furloughed AA guys, how come they don't flow back into Eagle and put you all in the ERJ or something? I am not familiar with your flowback policy, but it seems since AE is owned by AMR that sh1t would roll downhill all the way, not just to the TWA guys or mainliners.

Anyway, I've a few friends at Eagle and would be curious to know if they'll keep their jobs too.

Thanks and good luck to all of you!
Here are some stats:

Elimination of the F-100 fleet. To be completly retired by 2005.

Elimination of the TWA 767s. Replacements to them to be purchased in 2004.

9% reduction in flying this fall (for seasonal flying) normal is around 4% reduction.

Elimination in our 767 of first class. They are going to a 2 class configuration. Business and coach.

Early retirment package for upto 450 pilots (unlike what TWAdude said this package goes out to everyone not just ex-twa guys.

Upto 550 pilot furloughs (in addition to what we have now). As of now the Oct 1 100 and Nov 1 100 will be in reverse seniority out of the STL domicile. Will announce further reductions or less pertaining to that later.

These are the current stats as of 1230CST.

As forthe other question about Eagle flow back.

I am speaking from what I understand to be true ( the above are facts). ex-twa are not given the flow back option. Additionally if AA furloughs more Eagle already has guys on furlough, and I am not sure they would be allowed to flow anymore back. That is my understanding, it may be wrong. Will try to find out more.

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I am sorry to hear the news. The day that I got my furlough notice was one of the worst of my life (I guess I should consider myself lucky).

The point is, a lot of us know how you feel right now, and wish you the best of luck. Hopefully this will be over soon.

In the meantime, try to keep your chin up.


(former TWA and loved every second of it)(STL 727 F/E, JFK MD80 F/O, JFK 757/767 FO)

We lost money, but we sure had fun doing it!

Sorry to hear about that. I didn't see that part of your post.
Hoping the old guys take the leave and you stay on.
Best wishes.

TWA Aspirations

I'm sorry to hear so many more are going to lose their jobs. Suddenly, being almost three months in the Comair hiring pool doesn't bother me so much any more. It pains me to see TWA possibly get the short end of the stick. I grew up in STL and learned to love aviation sitting in the gravel lot on Lindbergh Blvd watching the Ozark and TWA DC-9s thunder down the runway, along with the occasional ANG F-100 and the then debuting F-15 going ballistic. I used to want to fly TWA and did all my pax flying with them any chance I got while in the USN. I guess that's a bygone era.

As old as I am, Comair may be where I'll spend my whole career, which is perfectly fine with me, though I'd love to fly for mainline if the upswing occurs soon. I'll just be thankful for a job in these times! Who knew in '99 when I made the fateful decision to change careers that this was in store for us. Hopefully the cycle will reverse and all will be well soon...God willing.

I wish you all well. Godspeed!
Re: TWA Aspirations


Thanks for the kind words.

I'm single, 33, my car is paid for and my apartment lease expires shorty. I know I'll manage.

On the employee parking bus today I talked with a friend from my newhire class. New baby, new house, spouse doesn't make much. My heart was wrenched. I've given generously to furlough loan and grant funds and I sincerely regret that I'll have to stop.

FYI, here's some more info on exact furlough dates obtained verbally from V.P. Kudwa:

October 13 - 100
November 1 - 78 (looks like this'll be me)
December 1 - 100
January 1 - 70
February 1 - 100

The remainder TBD

regards, y'all

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