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Will American Will Break Even In 2005  
User currently offlineIncitatus From Brazil, joined Feb 2005, 4050 posts, RR: 13
Posted (9 years 6 months 2 weeks 1 day 6 hours ago) and read 2833 times:

With several rounds of fare increases and higher load factors, it seems that AA will be able to break even in 2005 if oil stays in the $48-$50 range.


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User currently offlineQxq400 From United States of America, joined Dec 2004, 255 posts, RR: 2
Reply 1, posted (9 years 6 months 2 weeks 1 day 4 hours ago) and read 2741 times:

If any of the majors (AA,UA,DL,NW,CO) I think AA will have the best shot of breaking even.I have heard that they have giving some of the wages back to the employee's that they took.No other major is doing that right know.


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User currently offlinePadcrasher From , joined Dec 1969, posts, RR:
Reply 2, posted (9 years 6 months 2 weeks 1 day 4 hours ago) and read 2707 times:

There is no chance of that at the oil prices you mention. They lost $1.61 a share already this year and are expected to lose $4.71 for the year.

User currently offlineQQFLYER28 From United States of America, joined Nov 2004, 59 posts, RR: 0
Reply 3, posted (9 years 6 months 2 weeks 1 day 3 hours ago) and read 2657 times:

Quoting Padcrasher (Reply 2):

Yeah Padcrasher but if oil continues to fall below $48, like it has in recent days, their chances of making a profit go up dramatically.


User currently offlineIncitatus From Brazil, joined Feb 2005, 4050 posts, RR: 13
Reply 4, posted (9 years 6 months 2 weeks 1 day 3 hours ago) and read 2657 times:

Quoting Padcrasher (Reply 2):
There is no chance of that at the oil prices you mention. They lost $1.61 a share already this year and are expected to lose $4.71 for the year.

Check your source because the press release on the first quarter said $1.00 loss per share.
If oil stays at first quarter levels, AA's fuel bill will be 4.5 billion USD over the year. The average oil price for first quarter was about $52. It's gone already lower and today is trading in the $47's. For every dollar the price goes down there is a big impact in the final result. I think this difference is enough to erase the loss expectation.



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User currently offlineCommavia From United States of America, joined Apr 2005, 11840 posts, RR: 62
Reply 5, posted (9 years 6 months 2 weeks 1 day 3 hours ago) and read 2654 times:

Quoting Incitatus (Thread starter):
With several rounds of fare increases and higher load factors, it seems that AA will be able to break even in 2005 if oil stays in the $48-$50 range.

Not likely. The best shot AA has is to break even on an operating and net earnings basis in the second quarter, the seasonally strong summer travel season, but will almost definitely lose money on both an operating and net earnings basis for the year (although they will likely come pretty close to breakeven on operating earnings).

Quoting Qxq400 (Reply 1):
If any of the majors (AA,UA,DL,NW,CO) I think AA will have the best shot of breaking even.

I agree. AA is the closest to profitability of all the legacy carriers.

Quoting Qxq400 (Reply 1):
I have heard that they have giving some of the wages back to the employee's that they took.No other major is doing that right know.

Yes. All US employees just got a 1.5% raise. Sure, it is miniscule, but a lot better than what employees at most other carriers are contending with, not to mention that AA is still fully funding their pension obligations.


User currently offlineIncitatus From Brazil, joined Feb 2005, 4050 posts, RR: 13
Reply 6, posted (9 years 6 months 2 weeks 1 day 2 hours ago) and read 2564 times:

I have estimates for which average oil price for the remainder of the year other network carriers would break even.
Continental breaks even if oil goes to $42 and stays there. Northwest and United break even with oil at $28, and Delta with oil at $10.  eyepopping 

Chance of AA breaking even... >50%?
Chance of DL breaking even... hopeless.



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User currently offlineAANYC From , joined Dec 1969, posts, RR:
Reply 7, posted (9 years 6 months 2 weeks 1 day 2 hours ago) and read 2531 times:

Quoting Commavia (Reply 5):
Quoting Qxq400 (Reply 1):
I have heard that they have giving some of the wages back to the employee's that they took.No other major is doing that right know.



Quoting Commavia (Reply 5):
Yes. All US employees just got a 1.5% raise. Sure, it is miniscule, but a lot better than what employees at most other carriers are contending with, not to mention that AA is still fully funding their pension obligations.

The 1.5 % raise was a contactual obligation for the flight attendants. Also, it in no way comes close to the 33 % wage and benefit give backs from 2 years ago.


User currently offlineCommavia From United States of America, joined Apr 2005, 11840 posts, RR: 62
Reply 8, posted (9 years 6 months 2 weeks 1 day 1 hour ago) and read 2479 times:

Quoting AANYC (Reply 7):
The 1.5 % raise was a contactual obligation for the flight attendants. Also, it in no way comes close to the 33 % wage and benefit give backs from 2 years ago.

Would you rather be taken another pay cut and losing your pension? Believe me, I recognize (more than you can imagine) just how many sacrafices all AA employees have had to make, but I think -- on balance -- that AA employees should consider themselves pretty lucky. Yeah, your measely 1.5% raise doesn't come close to giving back what you had to give up, but I bet that the total value of your compensation -- salary, medical, pension, etc. is greater than most comporable compensation packages for FAs at other airlines (UA and US, specifically).


User currently offlineAASTEW From Dominican Republic, joined Oct 2001, 447 posts, RR: 1
Reply 9, posted (9 years 6 months 2 weeks 1 day ago) and read 2381 times:

My contractual raise amounted to .40 cents. Maybe I can purchase my dream home now...lol

I do have to agree with most, AA will probably be the first to return to profitability amongst the majors. Some of the cost cutting measures that many on this site laughed about seem to be helping a little.

AASTEW @LGA


User currently offlineCommavia From United States of America, joined Apr 2005, 11840 posts, RR: 62
Reply 10, posted (9 years 6 months 2 weeks 1 day ago) and read 2371 times:

Quoting AASTEW (Reply 9):
My contractual raise amounted to .40 cents. Maybe I can purchase my dream home now...lol

LOL - let's hope it only get's better from here, though!

Quoting AASTEW (Reply 9):
Some of the cost cutting measures that many on this site laughed about seem to be helping a little.

All the little stuff adds up! Who can forget the $40,000 First Class olive?  Wink


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