The bell tolls for AA

[scoreboardII]

And thats my point. AA has retrenched and is unable to support their current network on a cost bases, even if the pilots work for free.

 

[LearLove]

I don't know about you guys but my fear in this is that in CH11 (or even without 11) the AA guys agree to farm out 100 seaters. If that happens the rest of us at the bottom of DAL, UAL/CAL, AAA and even JB/SWA/Spirit will be in big jeopardy.

And BB (along with Mesa ans Skywest) is just chomping at the bit to find a place for his 190's and even grow that size fleet.

At that point the bottom 30 to 50% of each major's seniority list can kiss their career goodbye.

 

[Deli Guy]

I don't know about you guys but my fear in this is that in CH11 (or even without 11) the AA guys agree to farm out 100 seaters. If that happens the rest of us at the bottom of DAL, UAL/CAL, AAA and even JB/SWA/Spirit will be in big jeopardy.

And BB (along with Mesa ans Skywest) is just chomping at the bit to find a place for his 190's and even grow that size fleet.

At that point the bottom 30 to 50% of each major's seniority list can kiss their career goodbye.

And THEN....fast forward a few years:
"Economy...fuel....SARS....global conflict......cold sores....(fill in the blank), so that is why we desperately need to have SCOPE relief on 150 seat flying"

 

[Flopgut]

I don't know about you guys but my fear in this is that in CH11 (or even without 11) the AA guys agree to farm out 100 seaters. If that happens the rest of us at the bottom of DAL, UAL/CAL, AAA and even JB/SWA/Spirit will be in big jeopardy.

And BB (along with Mesa ans Skywest) is just chomping at the bit to find a place for his 190's and even grow that size fleet.

At that point the bottom 30 to 50% of each major's seniority list can kiss their career goodbye.

FWIW, more than 50% of these pilot groups list's understand this, so that sort of event will more than likely include work actions. If these regional pilots want to do it they are going on a scab list. Probably not the deterent it once was, but we'll see...

 

[OurMoney1]

They will drive this thing into CH 11 by years end.

They will gut labor.

They will filet scope.

They will blow the doors off of codeshare agreements.

They may be at a disadvantage now having not declared BK but they now are at a huge advantage because they will seek a post AA BK that undermines everyones current business plan.

Scary times....I agree UAL/DAL/LUV are gonna have a new 800 pound gorilla to deal with.

 

[rudder]

They will drive this thing into CH 11 by years end.

They will gut labor.

They will filet scope.

They will blow the doors off of codeshare agreements.

They may be at a disadvantage now having not declared BK but they now are at a huge advantage because they will seek a post AA BK that undermines everyones current business plan.

Scary times....I agree UAL/DAL/LUV are gonna have a new 800 pound gorilla to deal with.

I disagree.

If there is a CH11 filing then it will not necessarily mean a blank cheque for mgmnt. Any labour comparison will be based on benchmarking and it is unlikely that a new lower bar will flow out of the court process.

However, the uncertainty reinforces that instead of acting as victims that the AA pilots should be acting proactively in engaging with potential equity sponsors in framing the business plan that will be submitted to the court.

Notably excluded from this discussion? Incumbent senior management and the incumbent AMR BOD. Hasta la vista

 

[scoreboardII]

SWA would love to go against nothing but RJ's, they kick their CASM every leg, every day, all day long.

 

[scoreboardII]

I
At that point the bottom 30 to 50% of each major's seniority list can kiss their career goodbye.

Not if they play the cards right and demand to fly those very jets themselves.

 

[LearLove]

SWA would love to go against nothing but RJ's, they kick their CASM every leg, every day, all day long.

50 and 70 seaters for sure but against 100 to 115(ish) seats - I'd like to see those numbers.

 

[OurMoney1]

SWA would love to go against nothing but RJ's, they kick their CASM every leg, every day, all day long.

Something tells me an AA BK would reduce their dependency significantly on the RJ fleet. I see them leaning themselves out significantly.

 

["TheBigPicture"]

FWIW, more than 50% of these pilot groups list's understand this, so that sort of event will more than likely include work actions. If these regional pilots want to do it they are going on a scab list. Probably not the deterent it once was, but we'll see...

No it's not, because people like you throw it around at the drop of a hat...are you actually serious??

 

[satpak77]

do the AA folks think Ch.11 is the real deal this time around ?

 

[tathagatha]

I think Ch11 in this financial environment will be different. There is not a lot of banks willing to risk business loans to good creditors let alone bankrupt ones...

 

[altimaklr]

Chapter 11 is very dangerous now. It is not the same as when Delta did it. The company must now convince their creditors that they can make more money as a business than creditors can get from selling assets.

Take a look at what happened with the Borders Bookstore bankruptcy. They tried to salvage the company by selling unprofitable stores and still couldn't make it work.

A likely scenario would be creditors liquidating 777/738's and using the remaining cash balance to cover unsecured assets as much as possible.

 

[scoreboardII]

Looking at AMR's numbers:

Balance sheet:

$4B in cash
$11B in debt
Book value per share a negative $14.40

Income:

EPS is negative at -$2.93


Price to book: N/A

Lots of bad numbers here.