ckfred
Topic Author
Posts: 4763
Joined: Wed Apr 25, 2001 12:50 pm

AA/AMR Senior Management Job Security

Mon Sep 19, 2011 5:36 pm

Considering that AA/AMR lost money last year and will probably lose money for all of 2011, while competitors make money, how secure is Gerard Arpey as CEO?

Carol Bartz just gone shown the door at Yahoo! for steady underperformance. I could go through a long list of CEOs, both inside and outside of the airline industry, who have lost their jobs due to poor performance when compared to peer companies.

If Arpey were to lose the confidence of the Board of Directors, would the Board consider an internal candidate for CEO, as it did after the retirement of Bob Crandall and the sudden resignation of Don Carty? Or, would the Board look for an external candidate who might bring a fresh perspective on running AA?

Would a new CEO also decide to shake up senior management?
 
aajfksjubklyn
Posts: 458
Joined: Wed Jul 25, 2007 10:46 pm

RE: AA/AMR Senior Management Job Security

Mon Sep 19, 2011 5:59 pm

Great article in the Fort Worth Star Telegram today about upper management at AA...particulary on Virasb Vahidi and the airlines long term plans....Its not as bad as this Airliners.net make it out to be.
 
flyby519
Posts: 1180
Joined: Tue Jul 24, 2007 3:31 am

RE: AA/AMR Senior Management Job Security

Mon Sep 19, 2011 6:08 pm

I thought Horton was being groomed as the next CEO after Arpey gets the boot?
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goldenstate
Posts: 155
Joined: Thu Feb 04, 2010 11:24 pm

RE: AA/AMR Senior Management Job Security

Mon Sep 19, 2011 9:24 pm

Quoting ckfred (Thread starter):
If Arpey were to lose the confidence of the Board of Directors, would the Board consider an internal candidate for CEO, as it did after the retirement of Bob Crandall and the sudden resignation of Don Carty? Or, would the Board look for an external candidate who might bring a fresh perspective on running AA?

Would a new CEO also decide to shake up senior management?

All you're going to get here is speculation, since nobody but the BOD members really knows how they feel.

My supposition is that if a change is seen as necessary and appropriate, Arpey would be given the opportunity to exit in a graceful and dignified manner by retiring after 29 years of service to American.

Putting aside speculation about boardroom politics and whispering, AA needs to make some changes but is not yet in such dire straits that Chapter 11 is unavoidable.

AA has incredible assets at its disposal: network, facilities, people. Their problems are well documented, but with a firm and decisive course correction, AA can secure its future. The joint business agreements are expected to yield $500M in annualized incremental revenues. If AA can obtain modest labor cost reductions from its workgroups, perhaps $450M in annualized expense reduction, they can start generating some free cash flow and move beyond a hand to mouth existence.

I think there is a lot of incremental margin within AA's business that has yet to be unlocked, but that can only happen with the cooperation of labor. Both management and the unions are weighed down with baggage from AA's "out of court restructuring." It is in the best interest of both groups to put aside the acrimony, face economic and competitive realities, and come to agreements that put AA on a path to sustainability. That outcome is within reach and attainable, but only if they work together.

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