Open

Coming up

Don't miss

Replay


LATEST SHOWS

THE INTERVIEW

Simon Serfaty, US foreign policy specialist

Read more

IN THE PAPERS

'It's a War, Stupid!'

Read more

BUSINESS DAILY

French PM calls on ECB to go further to help economy

Read more

IN THE PAPERS

'I love the Socialists'

Read more

WEB NEWS

Ukraine: Web users call for international assistance

Read more

WEB NEWS

France: Fighting political corruption with transparency

Read more

MEDIAWATCH

No strategy and a beige suit

Read more

AFRICA NEWS

South Africa: Four men found guilty of shooting Rwandan exile

Read more

THE WORLD THIS WEEK

The World This Week - August 29th, 2014

Read more

  • Ukrainian forces retreat from Luhansk airport after clashes

    Read more

  • Iraqi forces free Armeli in biggest victory over IS militants since June

    Read more

  • Teddy Riner, France’s unstoppable judo champion

    Read more

  • Monaco’s Falcao set for Man Utd loan on transfer deadline day

    Read more

  • Spain orders custody for parents of ill British boy

    Read more

  • Anti-government protesters storm Pakistan's state TV

    Read more

  • Putin calls for talks on 'statehood' for east Ukraine

    Read more

  • Poland marks 75 years since German invasion of WWII

    Read more

  • Israel appropriates large tracts of West Bank land

    Read more

  • Rescue efforts under way after French apartment block blast

    Read more

  • Web doc on French self-immolation protests takes top prize

    Read more

  • PSG trounce Saint-Etienne 5-0 with Ibrahimovic hat trick

    Read more

  • Tension rises in Hong Kong as Beijing rejects open elections

    Read more

  • French police stop 'teenage jihadist' from flying to Syria

    Read more

  • Kidnapped Yazidi women 'sold to Islamists' in Syria

    Read more

  • Confusion reigns after Lesotho 'coup'

    Read more

Business

American Airlines files for bankruptcy protection

Text by News Wires

Latest update : 2011-11-29

American Airlines and its parent AMR Corp filed for bankruptcy protection on Tuesday following a breakdown in negotiations with employees to reduce labour costs. The airline had also been suffering from high fuel prices.

REUTERS - American Airlines and its parent company AMR Corp filed for bankruptcy protection on Tuesday after failing to win a deal with pilots earlier this month to pare its labor costs.

AMR had been the only major U.S. carrier to avoid bankruptcy proceedings in the past decade, a move its rivals had used to restructure their labor agreements and cut costs.

That left AMR, the third-largest U.S. airline behind United Continental Holdings Inc and Delta Air Lines Inc, with the highest costs in the industry, and the only major airline that still must fund worker pensions.

The airline said last month it was also suffering from soaring fuel prices that sent its costs 40 percent higher in the third quarter from a year earlier.

AMR also on Tuesday named Thomas Horton as its chairman and chief executive, replacing Gerard Arpey, who retired, the company said in a separate statement.

Under its Chapter 11 filing in a New York court, the company listed assets of about $24.72 billion, while it has liabilities of $29.55 billion. The company said it has $4.1 billion in cash.

AMR said both American Airlines and American Eagle are expected to fly normal schedules throughout the Chapter 11 process.

“We plan to initiate further negotiations with all of our unions to reduce our labor costs to competitive levels,” CEO Horton said.

AMR’s top rivals, UAL Corp and Delta Air Lines, which both used bankruptcy protection to slash costs, have since found merger partners—Delta bought Northwest Airlines and UAL Corp bought Continental Airlines to form United Continental Holdings.

AMR has been in labor talks with its pilots for five years, and a wave of pilot retirements in October had prompted speculation the airline was nearing a bankruptcy filing.

Some industry watchers believed the pilots chose to retire to lock in pension values that may now be in jeopardy as the company moves through bankruptcy court.

The company said the bankruptcy has no direct legal impact on operations outside the United States and it was not considering debtor-in-possession financing.

It said Weil, Gotshal & Manges LLP is lead counsel on the case.

Date created : 2011-11-29

  • AVIATION

    Boeing's largest-ever order set to boost US economy

    Read more

  • AVIATION

    Qantas resumes flights after court rules on labour dispute

    Read more

  • AVIATION

    Air France cancels 15% of flights as strike enters third day

    Read more

COMMENT(S)