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Experts, Leaders Weigh-In On AMR Bankruptcy

Business as usual expected for Fort Worth-based airline

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    NEWSLETTERS

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    AMR CEO Tom Horton says it's time to move the company forward.

    Below is a collection of soundbites from experts and politicans who spoke with NBC 5 about the Chapter 11 bankruptcy filing of Fort Worth-based American Airlines.

    On the impact in North Texas

    "We hope this is a reorganization and not a loss of jobs. They are one of our largest employers and one of our largest taxpayers." -- Fort Worth Mayor Betsy Price

    "The path ahead will be hard, but it's a well-worn path and we will make the company successful. We have great assets and we have great people. We have hubs in the most important markets in North America, we have the best partners around the world in the best markets around the world." -- Tom Horton, CEO of American Airlines

    "For economic development, it's huge for us because it makes access in and out of the region so easy." --  Betsy Price

    On the impact for travelers

    "The FAA acts swiftly to aggressively protect the safety of the traveling public any time an airline files for bankruptcy protection. Inspectors have already stepped up surveillance of American Airlines and American Eagle. We will continue to monitor all areas of the operation, particularly maintenance programs and personnel, records and reporting systems, management of company and manufacturer manuals, training programs and spare parts inventories. Heightened surveillance is targeted toward any area where risk is detected." -- Lynn Lunsford, Federal Aviation Administration

    "There are a couple of things they (passengers) will notice. First of all, I think the employees are gonna be stunned and I don't think the employees will be as friendly as they could be, I guess. I think that's gonna be a factor. And I also think another factor is American's probably not gonna fly as many routes to as many destinations as often as they have in the past. They're probably gonna cut back on flights. Other than that, the traveling public not's gonna notice as much of a difference." -- Denny Kelly, aviation expert

    "I think ultimately what consumers are worried about today is, if I'm holding tickets for the holidays, am I gonna be able to fly. And absolutely, you will be able to fly. In fact, I'm holding three tickets for the next four weeks on American, and I'm not worried about those tickets. When you wake up this morning, you will probably make your holiday flight, don't worry about that. American is actually pretty stable business wise, but it's pretty shocking and the morale will be down. And guess what? We're just gonna have fewer flights probably not in Dallas because Dallas is a major business hub but around the country, there will be fewer American flights."  -- Rick Seaney with Fare Compare

    "I don't think there's gonna be a tremendous amount of cutting routes or slowing down of service or ending service. There are gonna be some, but I think the traveling public will be okay especially during the holidays. I don't think the traveling public, if you were going out next Tuesday and getting on American and going to London, I don't think you're gonna notice much of a difference." -- Denny Kelly

    On how it may impact employees of AMR

    "Given the state of the economy and the condition of American Airlines, it didn't come as a great surprise. Tom Horton called me very early this morning to give me the heads up. And, of course, you know we're very disappointed. But as the company seeks protection under bankruptcy, I hope the company remembers the important role the employees play and will continue to play in bringing American back to success. I told him (Tom Horton) we cannot forget the employees. We have to work out the best possible outcome for all of the employees throughout this, and that the flight attendants have been, have really been struggling for a long time and this is a time to turn everything around. Knowing it was a possibility, we've been preparing as best as one could prepare for this. And I do feel confident that we can get back on our feet. I really do." -- Laura Glading, Association of Professional Flight Attendants

    "It's critical for the entire DFW area. We not only have all their flights based here, we have their maintenance facility at Alliance. [We have] 20,000 people employed with them and they fly most of their major flights out at the airport." -- Betsy Price

    "It's already become a smaller airline in the last few years, but I do see some cutbacks probably in play. Really what this is is a business tactic we saw with Delta before which is now one of the biggest airlines in the world with United in the past decade. It's really about becoming more competitive and not being able to do that in a normal way you would do that which is getting a bunch of agreements with a variety of labor unions and getting their costs down. And with this, I think everybody is surprised. I think the entire financial community expected American to at least have cash until the end of next year. And where the economy was heading, it's really surprising this occurred today." -- Rick Seaney

    "I think they're (employees) are gonna be affected tremdously and my heart goes out to them to the employees because it affects them greatly especially the pilots. Course people don't realize that with a pilot or a flight attendant, and to a certain extent mechanics, a pilot say on an MD80, he can't just say the heck with it and go over to Delta Airlines and become a captain for Delta. He can't do that. Everything is seniority. So his career is with American Airlines period. And it's gonna affect their salary, their working conditions. It's gonna affect their pension. There's a possibility that American Airlines could completely eliminate those pensions." -- Denny Kelly

    "Hurt like an Enron? No, not where they lose all of their retirement.  They'll probably keep their retirement packages in place and then have a new one to get used to and it may not be great going forward but they'll still have something." -- Clark Hodges, financial analyst

    "Short term, morale's gonna take a pretty big hit. It's already been pretty bad anyway. You can see it, at least in the North Texas area, with Southwest and American with the difference in the morale as you get on any plane and see the difference." -- Rick Seaney

    On filing bankruptcy now

    "The people of American Airlines have worked very hard and very honorably over the past decade to avoid that path [bankruptcy]. But, we're now at a point where it's time to turn the page and move forward. Circumstances have changed and it's time to move the company forward and that's what we are going to do." -- Tom Horton

    "This will make American, once again, an airline that they can be proud of." -- Robert Crandall, former CEO of American Airlines

    "I completely disagree with that. American was facing significant structural problems, the pilot contract not withstanding. We've talked about fuel, we've talked about the revenue disparity between our competition, specifically Delta and United.  We operate at a $1.5 to $2 billion revenue disparity relative to the copmetition out there and that's significant and that's not something the pilots at American can affect." -- Tom Hoban, Allied Pilots Association, when asked if the pilots were to blame for the bankruptcy filing.

    "It'll be a long time before they come out of bankruptcy and something probably American had to do and probably should've done years ago." -- Denny Kelly

    On the airline leadership

    "He (Arpey) was in charge of the airlines when all this went on. It's his failure. One of the problems the airlines have had, not only American but all of them that have filed bankruptcy, their management teams have been, for lack of a better term Harvard Business School grads, where in the old days, the airline people were airline people. They came up with the airlines. They knew the airline business. The airline business is different. Running American is different than running General Electric and this kind of thing. So that's one of the problems the airlines have had. Their management is really not airline people and they have not made the transition from business in general to the airline business." -- Denny Kelly

    "We've been investing in our products and services to be a world class global airline and maybe most importantly, a couple of months ago, back in the middle of the summer, we announced the largest aircraft order in aviation history. That deal gives us a great opportunity to not only have the youngest, most fuel-efficient fleet in the industry, but also it gives us enormous flexability to grow the company as we get our costs and capital structure in line." -- Tom Horton

    "We've been hearing this was pending. We're very disappointed. I think American and their unions gave really good faith efforts to try to avoid this. Most of their competitors have already been here. This is a reorganization bankruptcy, but anytime a major corporation goes through this, it's difficult for families, for the employees and indeed for all of us." -- Betsy Price

    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.