Old Feb 25, 03, 8:54 pm
  #7  
Middle_Seat
 
Join Date: Apr 2001
Location: Austin
Programs: AA P4L, WN, BA, DL, UA, HHonors, IHG
Posts: 3,421
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by askworldtraveler:
...I would encourage before commeting on this post reading the artical - signing up for the website is painless....</font>
Well, not exactly painless, they want to know name, address, phone and income. Fortunately, a bogus email address can be used successfully.

Here is the first portion of the article:
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">AMR could be bankrupt in May
Pilots' union says American's parent perilously low on cash

02/26/2003

By ERIC TORBENSON / The Dallas Morning News

American Airlines Inc.'s parent company has just three months' worth of cash reserves and could be forced into bankruptcy as soon as May, according to the carrier's pilots' union.

The Allied Pilots Association, after completing an independent analysis of AMR Corp. finances, also concluded that the $1.8 billion in annual employee concessions sought by the airline might not be enough to save it.

"Realize that the $1.8 [billion] is a minimum figure," a posting on the union's Web site says. "There is no guarantee that AMR won't ask for more. AMR states the alternative is bankruptcy."

American spokesman Bruce Hicks said the airline didn't want to comment on specifics of the union's findings. He said American was in productive talks with its unions.

"They understand the sense of urgency that we need," he said.

The Allied Pilots Association outlined the grim financial picture in board meetings and discussions over the past few days.

It issued its findings after getting unfettered access to AMR accounting books and finishing long discussions with American chief executive Donald Carty and president Gerard Arpey.

The union said it found that although American began the year with $2.7 billion in cash, $775 million of that is restricted, meaning it couldn't be used to pay bills.

That leaves $1.9 billion in the till, but American will be forced to refinance some debt this spring, a move the pilots say will cost $200 million. That lowers the balance to $1.7 billion.

The union believes that $1 billion is the minimum American needs to keep operating, a figure confirmed by analysts. United Airlines Inc. entered bankruptcy Dec. 9 with about $800 million in cash, and most analysts think it should have filed far sooner.

AMR chief financial officer Jeff Campbell said in January that American was losing about $5 million a day and would continue to do so during the winter, the weakest part of the travel season.

By doing the math, the pilots project that American would need to file for bankruptcy May 25.</font>
[This message has been edited by Middle_Seat (edited 02-25-2003).]
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