Coverage of the merger between American Airlines and US Airways

AA Fliers, Your Miles Are Safe

Travelers should notice little after bankruptcy filing

By Scott Mayerowitz
|  Tuesday, Nov 29, 2011  |  Updated 7:39 PM CDT
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For the 240,000 passengers who fly American Airlines each day, the airline's bankruptcy filing should have little noticeable impact.

Ken Kalthoff, NBC 5 News

For the 240,000 passengers who fly American Airlines each day, the airline's bankruptcy filing should have little noticeable impact.

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For the 240,000 passengers who fly American Airlines each day, the airline's bankruptcy filing should have little noticeable impact.

AMR Corp., the airline's parent company, said that it will continue normal flight operations as it heads to federal court to restructure. The move is aimed at reducing AMR's hefty costs, including for labor.

Delta, United, Continental and US Airways have all gone through Chapter 11. Travelers continued to book tickets. Planes still took off and landed and frequent flier miles were still earned and redeemed.

The only risk to passengers is if the restructuring fails, the airline ultimately liquidates and ceases to fly. Still, many travelers are protected in that case if they bought tickets with a credit card.

As for frequent flier miles, Eastern Airlines, Pan Am and Trans World Airlines all ceased flying but miles in their programs were transferred over to other airlines that bought some of their assets. TWA miles actually went into American Airlines' frequent flier program, AAdvantage.

"Miles are safe," said Gary Leff, co-founder of frequent flier site MilePoint. He said the bankruptcies of past airlines "are instructive." He even suggested there might be some promotions to keep loyal travelers.

American is the nation's third-largest airline behind United Continental Holdings Inc. and Delta Air Lines Inc. Like its rivals, American has raised fares over the past year to offset the high cost of fuel. But for AMR, it hasn't been enough.

AMR said fuel costs rose 40 percent in the third quarter. Combined with AMR's much higher labor costs, that resulted in a $162 million quarterly loss for AMR, while Delta and United had a combined profit of $1.2 billion.

American Airlines Bankruptcy:
Find complete coverage of the American Airlines Bankruptcy proceedings, expert analysis, and impact to customers and the local economy in our Special Section. Click here for more.


American Airlines Merger:
Complete coverage of the merger between American Airlines and US Airways into the newly-formed Fort Worth-based company, American Airlines Group (AAL). Click here for more.

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