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American Airlines files for bankruptcy protection
By David Koenig, AP Airlines Writer | AP – 12 hours ago
DALLAS (AP) -- The parent company of American Airlines filed for bankruptcy protection Tuesday, seeking relief from crushing debt caused by high fuel prices and expensive labor contracts that its competitors shed years ago.
READ MORE: http://finance.yahoo.com/news/american-airlines-files-bankruptcy-protection-121438848.html
Walker
The KLD / Downtown
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Snarf said:
I swear I heard something on the news while making dinner last night that airlines haven't turned a profit in fifty years or something along those lines.
Roads, rail and bike lanes haven't turned a profit in 50 years either, so that puts them on par with all forms of transportation.
Does it make sense for any type of transit infrastructure be privatized? Doesn't seem like a feasible solution.
LBDD
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Snarf said:
I swear I heard something on the news while making dinner last night that airlines haven't turned a profit in fifty years or something along those lines.
I heard this same thing... I believe they said the airline industry has collectively lost over $30 billion over the last 30 years or so.
rus
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cheap said:
it's kind of hard to blame organized labor for their failure when other airlines are making money hand over fist.lameness at it's finest.
http://www.forbes.com/sites/andrewbender/2011/11/29/american-airlines-bankruptcy-who-loses/
So who is likely to be hurt? “The whole objective of the Chapter 11 is to look at cost structures and negotiate with creditors and labor,” says Vasigh. “Some airports that are not profitable will lose services or at least frequency of services.”American’s employees aren’t likely to be happy either. Under Chapter 11, other airlines have been able to negotiate significant concessions with labor unions.
American was unique among “legacy” airlines in the US (major carriers around since the industry was deregulated in 1978) in not having declared bankruptcy. Delta, United and US Airways all filed for Chapter 11 in the last decade. In fact, US Airways, Delta and Continental have all been through it twice. Vasigh calls Chapter 11 “very regular in the airline industry.”
Seems like the other airlines ( with the exception of Southwest, apparently ) have already used chapter 11 to renegotiate costs with organized labor.
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