American Airlines may cut 6,000 jobs
DALLAS — Many more job cuts — probably more than 6,000 — are likely at American Airlines as the nation’s biggest airline hunkers down and tries to survive record high fuel costs.
American notified its flight attendants union on Wednesday that it will cut up to 900 jobs starting Aug. 31, but that appears to be the tip of the iceberg.
Although American has not given a total figure, the airline says it expects to shed 8 percent of its work force. With about 85,500 workers, including those at sister airline American Eagle, that would represent more than 6,800 jobs.
American plans to cut domestic capacity 11 percent to 12 percent this fall. Overall, including international flying, that translates to a pullback of about 8 percent.
Jeffrey Brundage, senior vice president of personnel at American parent AMR Corp., said in a memo to employees that jobs will be reduced “commensurate” with the overall 8 percent reductions.
Brundage, however, did not cite a specific number in his memo. And he said the company is still working through the specifics by employee type — pilots, mechanics and so on.
The company said last week that it would cut management and support staff jobs by about 8 percent in September.
American’s unions have been waiting for grim news since May, when the company announced it would sharply curtail U. S. flying and retire 45 to 50 planes after the busy summer vacation season.
AMR lost $328 million in the first quarter of this year, and the second quarter got off to an even worse start when American grounded its MD-80 fleet for safety inspections. More than 3,000 flights were canceled, costing the airline tens of millions of dollars in lost ticket sales.
Analysts expect AMR to post a loss of about $330 million in the just-concluded second quarter, according to a survey by Thomson Financial.
That does not include onetime charges, and AMR said it expects to take a charge of $1.1 billion to $1.2 billion in the second quarter to write down the value of its MD-80 and Embraer RJ-135 aircraft fleets. AMR also expects a $70 million charge to cover severance costs over the next year, some of which will show up in the third quarter.
American’s planned job cuts follow announcements of similar reductions at other U. S. carriers — 4,000 at Delta Air Lines, 3,000 at Continental Airlines, 2,550 at UAL Corp.’s United Airlines, and 1,700 at US Airways Group.
Airlines are raising fares and special fees to raise cash. Late Wednesday, United boosted the fuel surcharge on U. S. travel by $20, it is now up to $170 per round trip. American and Continental matched the increase on Thursday.
