Member

Joined: 28 Apr 2008
Posts: 157
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Just read the report this morning. I think this is their first time in history filing for BK. All of this comes in the midst of pilot negotiations.

http://money.cnn.com/2011/11/2...bankruptcy/index.htm?hpt=hp_t2

Site Admin

Joined: 15 Jun 2005
Posts: 2316
Location: Indianapolis, IN

The real unfortunate thing is that AA will surely dump their pensions on the taxpayers. This also means retired pilots are going to see their retirements slashed greatly. A pension is nothing more than deferred payroll. It certainly isn't charity so there is no other way to look at this than deferred pay. The airline could have paid the workers more but chose to defer part of it in a retirement plan. I don't believe you should be allowed to dump a payroll obligation and still remain in business. I can see terminating contributions to people who aren't fully vested but there is something seriously wrong when it comes to cheating people out of a retirement.

American will want to make these changes including what will certainly be wage cuts. But will American make any changes to their business model? Their expensive hub and spoke system is as much to blame as high wages. Should anyone be forced to take a pay cut if the airline isn't going to rethink the way they operate?

Site Admin

Joined: 15 Jun 2005
Posts: 2316
Location: Indianapolis, IN

BTW that rant isn't against AA specifically. That goes for every airline that has abused the bankruptcy system to cover for bad management.

Member

Joined: 11 Feb 2012
Posts: 165
Location: Indianapolis, IN

Has anybody heard any updates on AA's bankruptcy.