AMR Corp., parent company of American Airlines and American Eagle, today filed for bankruptcy.
The Dallas-based company voluntarily submitted petitions for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York.
In a statement sent the afternoon of Nov. 29, Springfield-Branson National Airport spokesman Kent Boyd said American Airlines' 10 daily flights - seven to Dallas and three to Chicago - at the Springfield airport likely will be uninterrupted by the bankruptcy filing, but noted the airport would be closely watching the progress of the reorganization.
"Bankruptcy proceedings in the airline industry are old hat," Boyd said in the statement. "In the past ten years, Springfield has lived through the bankruptcies of United and Delta without service interruptions.
"Bankruptcy has almost become an acceptable means of getting an airline’s financial house in order. Both (United and Delta) emerged from the process in much better long-term financial shape," he added. "The process allowed them to shed costs and renegotiate labor contracts. American wants to do the same."
A news release said American Airlines would continue to operate its normal flight schedules, honor tickets and reservations, maintain its frequent flyer and other customer service programs, and continue providing employee wages, health care coverage, vacation and other benefits.
"American serves 260 airports in more than 50 countries and territories, and we are committed to maintaining a strong presence in worldwide markets," said Thomas Horton, president and CEO of AMR and American Airlines, in the release, which noted the company's operations outside the U.S. wouldn't be affected legally by the bankruptcy filing.
AMR has roughly $4.1 billion in unrestricted cash and short-term investments, which it expects would be sufficient to pay its vendors, suppliers and other business partners during the reorganization.
"This was a difficult decision, but it is the necessary and right path for us to take, and take now, to become a more efficient, financially stronger and competitive airline," said Horton, who succeeded Gerard Arpey, the former president and CEO who submitted his resignation today after informing the company's board of his intention to retire.
"We are committed to working as quickly and efficiently as possible to appropriately restructure American so that it can emerge from Chapter 11 well-positioned to assure the company’s long-term viability and its ability to compete effectively in the marketplace," Horton added.
In the third quarter, AMR reported a net loss of $162 million, compared to profits of $143 million in the same quarter of 2010.
For the the nine months ended Sept. 30, the company recorded a 12 percent increase in expenses to $18.3 billion, largely due to a 32.8 percent increase in aircraft fuel. For its fiscal year, AMR has posted a net loss of $884 million.
As of 8:45 a.m., AMR stock was trading at $1.62, compared to its 52-week range of $1.55 to $8.89.[[In-content Ad]]
A franchise store of a Branson West-based quilting business made its Queen City debut; Grateful Vase launched in Lebanon; and Branson entertainment venue The Social Birdy had its grand opening.
