(Reuters) - Bankrupt American Airlines (Other OTC:AAMRQ.PK - News) aims to boost revenue by $1 billion annually by beefing up its international routes and fleet to lure more well-heeled business travelers, the company said on Tuesday.
Lower costs achieved through bankruptcy will enable the airline's corporate parent, AMR Corp, "to create the premier airline for high-value customers, who choose airlines based on network, alliances, products and services," Chief Commercial Officer Virasb Vahidi said in a letter to employees.
"While the number of these customers is small, they provide a disproportionate amount of revenue and are critical to our success," Vahidi said.
AMR and American Airlines filed for Chapter 11 bankruptcy protection on November 29, citing high costs, including for labor.
The company said this month that it wants to trim $2 billion a year from its costs, including $1.25 billion in employee-related expenses, and generate $1 billion per year in new revenue.
The company, which has long targeted business travelers, said that by cutting costs and easing restrictive contracts, it can focus on network, fleet and partnerships to generate the revenue improvements.
About two-thirds of the revenue boost will come from "right-gauging our fleet," Vahidi said. The remainder will come from bolstering existing partnerships with foreign airlines like British Airways (:ICAG.L), Iberia, Japan Airlines and Qantas(ASX:QAN.AX - News), he said.
Vahidi said AMR wants to move ahead with last year's order for 460 narrow-body airplanes and earlier plans to acquire wide-body Boeing (NYSE:BA - News) 787 and 777 aircraft.
He said the airline also intends to invest in products and services like lie-flat seats and in-flight wi-fi that high-end customers who pay the most for tickets will find attractive.
"Our disadvantaged cost structure and balance sheet have greatly limited our ability to invest in products or match our competitors' actions in some cases," Vahidi said.
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Does Any Of This Look Familiar?
Started by
Thebean
, Feb 21 2012 03:56 PM
5 replies to this topic
#2
malcolm
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Posted 21 February 2012 - 05:04 PM
The problem with AA, at least when I last travelled on them was that their 1st class service, other than the booze, hot sundae and the odd hot cookie , did not come close to the business class services offered by AC or CP at the time (10 years ago). Their FAs spent a lot of time hiding behind the curtain.
Maybe they are now as good as our Canadian carriers but if they do intend to lure more business travellers, then they need to up the bar. Anyone with recent experience in their business class, domestic or transborder?
Maybe they are now as good as our Canadian carriers but if they do intend to lure more business travellers, then they need to up the bar. Anyone with recent experience in their business class, domestic or transborder?
#3
J.O.
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Posted 22 February 2012 - 04:07 AM
They aren't. Not even close.
No carrier in the USA offers a service in business class that would compete with the free stuff that Air Transat and Sunwing include in the price, never mind anything close to AC's business class.
No carrier in the USA offers a service in business class that would compete with the free stuff that Air Transat and Sunwing include in the price, never mind anything close to AC's business class.
#4
rudder
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Posted 22 February 2012 - 06:32 AM
American Airlines Flight Attendant Launches Petition to Replace Airline Management
MIAMI, Feb. 22, 2012 /PRNewswire/ -- A controversial series of YouTube videos mocking a flight attendant's bosses at American Airlines has morphed into an all-out grassroots movement to remove the upper-management team now running American Airlines, which filed for Chapter 11 Bankruptcy protection in November of 2011. The bankruptcy filing was followed by an announcement of extensive layoffs and planned pay cuts at the airline. Multi-million-dollar bonuses and lavish perks were paid to top executives while 15,000 employees expect to lose their jobs and benefits.
A website has been created, www.sAAveAA.com, to allow American employees, the traveling public and workers everywhere to sign the petition online asking that the leadership at American be replaced during the reorganization. Once 250,000 signatures are collected, the petition will be turned over to Judge Sean Lane, who is presiding over the American Airlines bankruptcy case. Gailen David, a 24-year flight attendant with American, has been joined in this campaign by thousands of supporters gained through the popularity of his videos and blogs.
Why would a flight attendant put his job at risk by speaking out so publicly against his employer?
"The current management team has led American though more than a decade of profound decline in customer service, leadership, financial stability and employee morale. The time has come to take a new direction. We ask Judge Lane to put an end to the madness and bring in proven, competent leadership to help create a new American Airlines," says David, who recently released a series of videos on YouTube poking fun at the management of American Airlines.
A "Message to American Airlines Flight Attendants" was the first video released on YouTube by David -- now on a leave of absence. In the video, dressed as a female airline executive with a Texas accent, Mr. David reads a letter sent to flight attendants by American's Vice President of Onboard Services, Lauri Curtis. His tongue-in-cheek, saccharin-laced rendition of the letter resonated with employees and the public alike and quickly reached viral status on the Internet.
"The response from other American Airlines staff and the general public has been overwhelming and has only given me determination to shine a spotlight on the reckless mismanagement that has been occurring at American for over a decade. It is time for fresh, visionary leadership at AA that will make it an airline that people love to fly and to be a part of once again," David says.
The next videos were based on the movie trailers for the motion picture "Iron Lady," which starred Meryl Streep as Margaret Thatcher, former Prime Minister of the UK. The "Aluminum Lady" and "Aluminum Lady 2" are his spoof on the "Iron Lady" trailers starring American Airlines' fictional "Minister of Flight Attendants," a character he created that embodies all of the most inhumane and avaricious qualities of today's boardroom villains.
American Airlines was not amused and they quickly threatened to terminate David's employment if he did not show up for an investigatory/disciplinary meeting. Following worldwide media coverage, American's spokesperson, Bruce Hicks, issued a new statement to the media claiming that they had "no intention" of terminating David. They only wished to discuss the matter with him as he returns to work at the end of his leave of absence. The airline has not yet made a statement since the petition was launched on February 17, 2012.
About Gailen David
Gailen David has flown for American Airlines for 24 years and is based in Miami. In 2007, he created "Dear Sky Steward," his travel blog in which he leads a discussion about "Jetiquette -- Civilized Travel." Through his blog, social media and monthly television appearances, he reaches an audience of over 20 million viewers per month. He is passionate about customer service and hopes that he can bring honor and dignity back to air travel.
Website: www.dearskysteward.com
Facebook: www.facebook.com/dearskysteward
Twitter: www.twitter.com/skysteward
MIAMI, Feb. 22, 2012 /PRNewswire/ -- A controversial series of YouTube videos mocking a flight attendant's bosses at American Airlines has morphed into an all-out grassroots movement to remove the upper-management team now running American Airlines, which filed for Chapter 11 Bankruptcy protection in November of 2011. The bankruptcy filing was followed by an announcement of extensive layoffs and planned pay cuts at the airline. Multi-million-dollar bonuses and lavish perks were paid to top executives while 15,000 employees expect to lose their jobs and benefits.
A website has been created, www.sAAveAA.com, to allow American employees, the traveling public and workers everywhere to sign the petition online asking that the leadership at American be replaced during the reorganization. Once 250,000 signatures are collected, the petition will be turned over to Judge Sean Lane, who is presiding over the American Airlines bankruptcy case. Gailen David, a 24-year flight attendant with American, has been joined in this campaign by thousands of supporters gained through the popularity of his videos and blogs.
Why would a flight attendant put his job at risk by speaking out so publicly against his employer?
"The current management team has led American though more than a decade of profound decline in customer service, leadership, financial stability and employee morale. The time has come to take a new direction. We ask Judge Lane to put an end to the madness and bring in proven, competent leadership to help create a new American Airlines," says David, who recently released a series of videos on YouTube poking fun at the management of American Airlines.
A "Message to American Airlines Flight Attendants" was the first video released on YouTube by David -- now on a leave of absence. In the video, dressed as a female airline executive with a Texas accent, Mr. David reads a letter sent to flight attendants by American's Vice President of Onboard Services, Lauri Curtis. His tongue-in-cheek, saccharin-laced rendition of the letter resonated with employees and the public alike and quickly reached viral status on the Internet.
"The response from other American Airlines staff and the general public has been overwhelming and has only given me determination to shine a spotlight on the reckless mismanagement that has been occurring at American for over a decade. It is time for fresh, visionary leadership at AA that will make it an airline that people love to fly and to be a part of once again," David says.
The next videos were based on the movie trailers for the motion picture "Iron Lady," which starred Meryl Streep as Margaret Thatcher, former Prime Minister of the UK. The "Aluminum Lady" and "Aluminum Lady 2" are his spoof on the "Iron Lady" trailers starring American Airlines' fictional "Minister of Flight Attendants," a character he created that embodies all of the most inhumane and avaricious qualities of today's boardroom villains.
American Airlines was not amused and they quickly threatened to terminate David's employment if he did not show up for an investigatory/disciplinary meeting. Following worldwide media coverage, American's spokesperson, Bruce Hicks, issued a new statement to the media claiming that they had "no intention" of terminating David. They only wished to discuss the matter with him as he returns to work at the end of his leave of absence. The airline has not yet made a statement since the petition was launched on February 17, 2012.
About Gailen David
Gailen David has flown for American Airlines for 24 years and is based in Miami. In 2007, he created "Dear Sky Steward," his travel blog in which he leads a discussion about "Jetiquette -- Civilized Travel." Through his blog, social media and monthly television appearances, he reaches an audience of over 20 million viewers per month. He is passionate about customer service and hopes that he can bring honor and dignity back to air travel.
Website: www.dearskysteward.com
Facebook: www.facebook.com/dearskysteward
Twitter: www.twitter.com/skysteward
#5
DEFCON
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Posted 22 February 2012 - 11:00 AM
"The current management team has led American though more than a decade of profound decline in customer service, leadership, financial stability and employee morale. The time has come to take a new direction. We ask Judge Lane to put an end to the madness and bring in proven, competent leadership to help create a new American Airlines,"
I can think of several other carriers where this concept is applicable. They're easy to identify; they've been through bankruptcy at least once and continue to treat their 'brightest & best' to lavish remuneration packages. They blame labour for all that's wrong and yet, for all their blustery BS, remain consistently unable to demonstrate any ability to lead or much of anything else relative to their positions.
I can think of several other carriers where this concept is applicable. They're easy to identify; they've been through bankruptcy at least once and continue to treat their 'brightest & best' to lavish remuneration packages. They blame labour for all that's wrong and yet, for all their blustery BS, remain consistently unable to demonstrate any ability to lead or much of anything else relative to their positions.
#6
J.O.
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Posted 23 February 2012 - 04:39 AM
Some senior managers at AA left when this whole mess started. They tried to tell them ...
Edited by J.O., 23 February 2012 - 04:39 AM.
