burping_boy
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- Jan 14, 2002
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http://money.cnn.com/2002/08/13/news/companies/amr/index.htm
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.
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.