AMR to cut 6,840 jobs, post $1.27b in costs
DALLAS - American Airlines parent
AMR expects to eliminate about 8 percent of its workforce, or 6,840 jobs, when it reduces capacity in the fourth quarter, the company told workers at American and American Eagle yesterday. The job cuts would be the most among those already disclosed this year by US carriers.
American, the world's largest airline, and other US carriers are cutting flights and jobs as a near doubling of fuel prices over the past year erodes profits.
"Everybody is going to be taking these charges to adjust the accounting," Ray Neidl, an analyst with Calyon Securities in New York, said. "It's going to be big."
AMR will have a noncash charge of about $1.2 billion in the second quarter to reduce the value of
The Fort Worth-based airline plans to ground as many as 120 aircraft, end service to eight airports, and reduce flights from its hubs to blunt the damage of fuel costs, which the Air Transport Association said may push US carriers to record losses of $13 billion this year.
The noncash expense related to the aircraft doesn't affect liquidity "or our ability to pay our bills," chief executive Gerard Arpey told employees in an e-mail.
American will eliminate as many as 900 flight attendant jobs, or about 4.7 percent, effective Aug. 31, the Association of Professional Flight Attendants said yesterday. American previously said management and support staff would be cut by 8 percent.
The airline also said it reached agreements with the attendants union and the Transport Workers Union for early retirement offers. The airline also is offering leaves of absence and part-time work to help reduce involuntary layoffs. 