American Airlines is filing for bankruptcy protection as they try to cut costs and unload massive debt built up by years of high fuel prices and labor struggles according to AP. The company says that there will no impact on travelers for now. American said it would operate normally while it reorganizes in bankruptcy, but hinted at future flight and staffing cuts. The airline said it would continue to operate flights, honor tickets and take reservations. It said the AAdvantage frequent-flier program would not be affected.
Important: American is NOT shutting down. It’s filed for Chapter 11 protection, which means it will continue to operate while it reorganizes. Chapter 11 protection is a well-worn path taken by nearly every major US carrier at some point in the last 20 years. (Southwest Airlines is the exception.)
American and its Oneworld alliance partners have had a dwindling presence at SFO for a couple years now. AA exited SFO-Honolulu in September and left SFO-Boston last year. Partner QANTAS left SFO-Sydney last year. The carrier walked away from Oakland in 2008. It stopped flying its famous “nerd bird” flights between San Jose and Austin in 2009.
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From SFO, American flies nonstop to only its hubs at New York-JFK, Chicago-O’Hare, Dallas-Ft Worth, Miami and Los Angeles– and in all those markets faces stiff fare competition from low fare carriers like Virgin America, Southwest and JetBlue.
Last year, American inaugurated new service and a posh new Admiral’s Club at SFO’s swank Terminal 2, which it shares with Virgin America. While that presence won’t be affected in the short run, if the carrier continues to shrink at SFO over time, it will be interesting to watch what happens at T2.
How do you feel about American’s bankruptcy? Will it affect your decision to fly American?
I too will still make an effort to fly American Airlines. I’m most concerned about the Boeing/Airbus deal. I hope that continues to go forward. If we see issues with that deal I think that the airline is in really bad shape. I think there is also a great opportunity for US Airways or Alaska Airlines to snap up American. US Airways of course would have to join OneWorld, and Alaska Airlines would probably just fold into American.
JW Anderson says
I will still fly American Airlines. Earlier, American, did try not to use chapter 11 to unload Debt trusting their employees to do the right thing and compromise on labor cost. Now these same people will have to accept was coming.