KarlB737
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American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 3:38 pm

It seems AMR is making some progress just in the month of July alone. Maybe they won't need USAirways at all. What do you think? A letter from American CEO Tim Horton to the employees is also at the link.

Courtesy: Dallas Morning News

American Airlines’ Parent Company Reports Earnings Of $292 Million— And That’s Just In July

http://aviationblog.dallasnews.com/2...ns-292-million-in-july-alone.html/
 
commavia
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 4:05 pm

Ah yes ... these are the results of an airline that will collapse absent a merger.   

Seriously - these results are quite strong, and indicative of the substantial progress being made, even before any potential merger. AMR is not done yet, and still more is required, but things continue moving in a very positive direction.

Despite a negative cash flow for July of $81M, July revenue a respectable $2.5B, and a net margin (ex special reorganization items) of 14.1%! Net income (ex special items) of $641M for June and July - just two months. Obviously some of that is the benefit of continued bankruptcy court protection, and of course those are two of the three strongest travel months of the year, but even still - those are quite impressive numbers for an airline "left for dead" by some "analysts" and "experts."
 
ordbosewr
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 4:46 pm

And these results only help the DOJ in the lawsuit against US-AA.

It just goes to prove that AA should have gone into C11 long ago to right the ship.
 
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jfklganyc
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 4:57 pm

Honestly, how could they not be profitable?

They're bankrupt. Stopped paying the bills and renegotiated for pennies on the dollar.

Renegotiated all the costs and contracts as well.

If they weren't making lots of money now...they'd be morons.

America is a beautiful country. And a stand alone AA will be just fine!

[Edited 2013-08-26 10:23:08]
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 5:23 pm

Quoting jfklganyc (Reply 3):
Stopped paying the bills and renegotiated for pennies on the dollar.

Renegotiated all the costs and contracts as well.

If they aren't making lots of money now...they'd be morons.

America is a beautiful country.

Missing in all of that is the other side of the story, investors, those who lost millions, and those new ones who are lining up to invest in the airline industry, go figure.
 
sccutler
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 11:07 pm

Quoting commavia (Reply 1):
Ah yes ... these are the results of an airline that will collapse absent a merger.

Indeed! It's almost as if the airline is, I don't know, improving its business operations!

Quoting ORDBOSEWR (Reply 2):


It just goes to prove that AA should have gone into C11 long ago to right the ship.

That hindsight is right on point, but I find it hard to fault the persistent effort to survive without the shame of bankruptcy. The problem is, bankruptcy is no longer considered shameful. That fact, in itself is (you guessed it) a real shame!

Quoting jfklganyc (Reply 3):

They're bankrupt. Stopped paying the bills and renegotiated for pennies on the dollar.

Well, actually, not really. But we see what you're saying. The airline does not get to operate without paying ongoing operational expenses, so best to compare these results with all the carriers whose books have already been flushed by bankruptcy.

Quoting par13del (Reply 4):

Missing in all of that is the other side of the story, investors, those who lost millions, and those new ones who are lining up to invest in the airline industry, go figure.

Yep.
...three miles from BRONS, clear for the ILS one five approach...
 
skipness1E
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 11:23 pm

Quoting jfklganyc (Reply 3):
Honestly, how could they not be profitable?

They're bankrupt. Stopped paying the bills and renegotiated for pennies on the dollar.

Renegotiated all the costs and contracts as well.

If they weren't making lots of money now...they'd be morons.

America is a beautiful country.

Sorry, just for the rest of us. They reneged on their debts, screwed over their suppliers, axed staff salaries and are trading bankrupt against many companies who have to remain solvent, in conclusion, America is a beautifil country????

Can you all please have a wee think about the above?
 
aluminumtubing
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RE: American Airlines July Profit Doubles To $292M

Mon Aug 26, 2013 11:57 pm

Quoting skipness1E (Reply 6):
They reneged on their debts, screwed over their suppliers

The unsecured creditors are/were to be paid in full (via stock) and the previous shareholders are/were to get 3.5% of the stock albeit with a rather complicated formula. Are/were, depending on the outcome of the merger.

Quoting skipness1E (Reply 6):
Can you all please have a wee think about the above?

Good Idea!!!
 
JoePatroni707
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 2:11 am

Congrats to AA, still to early to get real excited. AA still has a long hard road ahead, but a good start!
 
SonomaFlyer
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 2:30 am

Quoting aluminumtubing (Reply 7):
The unsecured creditors are/were to be paid in full (via stock) and the previous shareholders are/were to get 3.5% of the stock albeit with a rather complicated formula. Are/were, depending on the outcome of the merger.

Being paid in stock is a far, far cry from being paid back. It means those creditors are now held hostage to the stock performing well enough for them to cash out at less than a massive loss. I'm happy for the AA employees but the profit doesn't mean a whole lot while they are operating under the auspices of the bankruptcy court.
 
oc2dc
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 2:49 am

This is obviously good news, however, it seems to be a double-edged sword. On the one hand, AA hasn't seen profit like this in a long time. It's a sign that AA is on its way to profitability. On the other hand, AA just demonstrated to the DOJ that they don't need US to survive. . . I think they just signed away their chances of sealing a merger deal...

...the merger speculation was fun while it lasted...
I'm not complaining, I'm critiquing...
 
slcdeltarumd11
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 2:51 am

Look at airfares this summer and Fall. Its no surprise AA is making money. All of this consolidation has raised fares. Less choices the airlines are not giving away seats anymore and less competitors.
 
ozark1
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:18 am

Quoting ORDBOSEWR (Reply 2):
And these results only help the DOJ in the lawsuit against US-AA.

It just goes to prove that AA should have gone into C11 long ago to right the ship.

You are 110 percent correct on both statements. Hindsight does no one any good, but if we had just filed years ago instead of taking the pay cuts, who knows where we would be today. Oh well! One day at a time! Glad we are at least making money. It's honestly the first thing in a LONG time we have had to be encouraged about.
 
ca2ohHP
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:21 am

Quoting slcdeltarumd11 (Reply 11):

Look at airfares this summer and Fall. Its no surprise AA is making money. All of this consolidation has raised fares. Less choices the airlines are not giving away seats anymore and less competitors.

What tangible evidence do you have that even supports that statement? I just bought a ticket DTW-SNA for $215 over Thanksgiving weekend; pretty cheap by today's standards but that's my opinion.

Slightly off topic but relevant, US Airways is completely screwing this deal up by crying "unfair" to the DOJ, when they could have responded by acknowledging the DOJ's concerns, and working through them like a sane adult. They are delusional if they believe they can take this on successfully.
 
RyanairGuru
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:49 am

Quoting ca2ohHP (Reply 13):
Slightly off topic but relevant, US Airways is completely screwing this deal up by crying "unfair" to the DOJ, when they could have responded by acknowledging the DOJ's concerns, and working through them like a sane adult

And who's to say they won't? It will take an army of lawyers a very long time to work through the complaint and come up with detailed and defensible positions, so in the mean time they have basically said "we disagree, and will get back to you later with more information". And it's not just US, but AA as well.
Worked Hard, Flew Right
 
commavia
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 4:24 am

Quoting skipness1E (Reply 6):
They reneged on their debts, screwed over their suppliers, axed staff salaries

Believe me - I agree completely. For almost a decade I have been lamenting the negative impact of bankruptcy on various stakeholders involved - especially employees.

But as I have always believed, in the long-run, economic reality always wins. While I and many others were commending AA and its unions for their genuine and admirable attempt to avoid Chapter 11, one by one each of AA's legacy competitors systematically used the bankruptcy process (at least once) to its full effect - rewriting uneconomic contracts, rejecting superfluous leases, abandoning old aircraft, and most importantly, eviscerating union contracts, and then funneling all these savings into necessary capital investments in facilities, new or upgraded aircraft, and improved products and services.

Against that backdrop, and whether the unions were wiling to accept the reality or not, AA had no choice but to compete. For better or worse, what's good for the goose is good for the gander.

Quoting skipness1E (Reply 6):
and are trading bankrupt against many companies who have to remain solvent

Well, as the saying goes, payback is ... "tough." AA is now in a position to do to Delta, Northwest, United and USAirways what those carriers did to AA a decade ago - namely, use the lower costs and greater flexibility brought about by bankruptcy to "buy" market share and compete far more aggressively.

Again - all of AA's legacy competitors did precisely this to AA. Now it's AA's turn.
 
sccutler
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 4:42 am

Quoting commavia (Reply 15):

Again - all of AA's legacy competitors did precisely this to AA. Now it's AA's turn.

+1,000.

I think some folks may be surprised at just how much AA can do here, with or without US.

And (by the way), US needs AA a great deal more than AA needs US. While I still believe a combination of the two would be wise, perhaps the most prudent approach would be to wait until after emerging from 11, and AA simply buying US.
...three miles from BRONS, clear for the ILS one five approach...
 
Max Q
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 4:53 am

I hope it is denied.


Both Airlines can do just fine independently, besides it was a shotgun marriage to begin with.
Just because US was the only one left doesn't mean AA should have hitched up with them !


I don't think AA management or any of their employees wanted it either, don't know about US
but they should be proud of their results as well lately.
The best contribution to safety is a competent Pilot.
 
skipness1E
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 7:44 am

I wasn't meaning US airlines, for a home of free trade, Chapter 11 has a protectionist result against foreign competitors. It's like saying I have a friend who beat his wife and stole her wages for years. I resisted the temptation for years but all the other men in my village also beat their wives and stole their money. It was time I got stuck in two when I saw how wealthy my friends had become.

My point is not to blame AA for doing it, to blame the system for allowing ANYONE to behave like that.
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 7:55 am

A simple 'good' I think will suffice on AA profit.

Quoting slcdeltarumd11 (Reply 11):
Look at airfares this summer and Fall. Its no surprise AA is making money. All of this consolidation has raised fares.

....raised fares to back where they should be. If a private commercial industry cannot charge its customers enough money to make a decent profit then something is seriously wrong. Thankfully consolidation has addressed the 'seriously wrong'

We are just getting back to sanity and where we should have always been !

Long-haul (at least) commercial air travel should not be 'cheap'
 
aluminumtubing
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 10:03 am

Quoting SonomaFlyer (Reply 9):
Being paid in stock is a far, far cry from being paid back.

Maybe, maybe not. If the market is flat, they are even. If it falls, they lose. If it rises, they profit. The point is, they were not screwed. Creditors did better in this bankruptcy than those in the bankruptcies of the other airlines. Of course it all depends on the merger outcome. It could go back to square one as far as the creditors are concerned.
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 10:25 am

Quoting 1400mph (Reply 19):
If a private commercial industry cannot charge its customers enough money to make a decent profit then something is seriously wrong.

With who, the company who cannot operate efficiently and compete or the customers who decides to use a product from another vendor?

Quoting 1400mph (Reply 19):
Thankfully consolidation has addressed the 'seriously wrong'

So the way to an efficient business is to buy up / merge the vendors to eliminate competition then raise prices?
The only problem left is the political one, where they go to the government and have them pass laws to prevent any other investor from ever starting another airline thus starting the competitive cycle all over again.
 
MaverickM11
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 10:58 am

Quoting Max Q (Reply 17):

I don't think AA management or any of their employees wanted it either, don't know about US
but they should be proud of their results as well lately.

AA management didn't want it, but AA's unions basically stiched together a deal with US in spite of AA management.
E pur si muove -Galileo
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 12:48 pm

Quoting par13del (Reply 21):
With who, the company who cannot operate efficiently and compete or the customers who decides to use a product from another vendor?
Quoting par13del (Reply 21):
So the way to an efficient business is to buy up / merge the vendors to eliminate competition then raise prices?
The only problem left is the political one, where they go to the government and have them pass laws to prevent any other investor from ever starting another airline thus starting the competitive cycle all over again.

You may spin it whichever way you wish. Not one American legacy airline avoided bankruptcy pre-consolidation.

Just about every major airline operating long-haul ops in the world today is involved in some form of consolidation. Even EK.

Fares will rise and that's good. Where is it written that airline travel should be an industry with awful profit margins ?

The airlines are finally clawing back their pricing power by working together on a monumental scale. They're all doing it so what do you suggest to stop it ? Re-regulate ? Re-nationalise ? Bring back Bermuda II and the like ?

Bon chance with that one.

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
 
jayunited
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 1:08 pm

This is great news for American Airline making profits wile in bankruptcy. This can only hurt AA/US potential merger and help the DOJ's case because it would seem as though American Airlines can compete against Delta and United and win as a stand alone carrier.

But It is not over yet who knows what will happen in a few months but what I am sure of is it that we are in for a exciting court case later this fall as AA and US lawyers try to explain why they can't compete while still posting profits.
 
jumpjets
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 2:47 pm

Maybe there is a converse argument - Currently both AA and US are profitable therefore if the proposed merger were to go ahead the combined entity would be financially stronger and the need to pare back routes and put up prices - which are advocated as reasons for the merger not to be allowed - would be reduced and therefore the merger could be seen as a good thing.

Just a thought.
 
ultrapig
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:08 pm

Here is Chapter 11 int eh Airline Busienss 101

The truth is somewhere in between.

AA is making an operational profit. That's good. It means that when you take the gross revenue from fares and fees and subtract the operating cost and depreciation there is a big plus number.

But in a company operating outside of Chapter 11 you would then deduct interest cost to get the net income.

A Company in Chapter 11 is not paying interest. (Although it does pay lessors)

If AA makes $292m per month and the same amount every month (unlikely give the seasonal nature of the business)-that's a profit of $3.5B a year before making payments on the bonds that it had or will have after the Chapter 11. Let's cut that in half and asume the present operations makes $1.75B a year.

Thus let's say that the deal in chapter 11 is tht the "Old" Shareholder get nothing. I'm simplifying the process greatly from 100 page prosecpectus to several paragraphs.

The Bondholders end up with "New Bonds" in the principal amount of $10B paying 6%.

The Bondholders end up with 100% of the shares in the reorganized company which has a projected income of $1.75B less $600M. in interest cost. Or justtover $1B a year-

A company with that kind of income is a valuble company.

AA was always profitable from an operational standpoint, like other companies in Chapter 11 it simply could not pay its bondholders who figured that a reorganization (or merger) gets them more than a liquidaiton.
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:31 pm

Quoting jumpjets (Reply 25):
Maybe there is a converse argument - Currently both AA and US are profitable therefore if the proposed merger were to go ahead the combined entity would be financially stronger and the need to pare back routes and put up prices - which are advocated as reasons for the merger not to be allowed - would be reduced and therefore the merger could be seen as a good thing.

I'm not disagreeing with you - just using what you say as a link to jump in.

We seem to have arrived at a situation where success is to be viewed with suspicious eyes.

Are we saying that AA should not be permitted to merge with U.S Airways because they are becoming successful / profitable again ? Sorry but that's just f-ing ridiculous.

Business is all about success and making money. If AA and US together will be more successful and make more money then that should be viewed as a good outcome.

Some of you may wish to flatter AA / US with the notion that together they will take over the world and totally dominate commercial aviation forever but that is equally ridiculous and a rather poor excuse to inhibit progress in favour of personal agendas.
 
ckfred
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:33 pm

Quoting jfklganyc (Reply 3):
Honestly, how could they not be profitable?

They're bankrupt. Stopped paying the bills and renegotiated for pennies on the dollar.

When a company is in Chapter 11, it has to pay all bills that come due after the filing date.

Quoting skipness1E (Reply 6):
Sorry, just for the rest of us. They reneged on their debts, screwed over their suppliers, axed staff salaries and are trading bankrupt against many companies who have to remain solvent, in conclusion, America is a beautifil country????

That's the difference between the European notion of bankrupcty and the American notion. In Europe, it's about making the creditors as whole as possible, to the detriment of the debtor. In the U.S., the land of the fresh start, it's about getting the debtor "back on his feet", even if the creditors take large losses.

On the other hand, the planned merger with US was supposed to pay off all creditors, secured and unsecured, and get the AMR shareholders a 3.5% stake in the new Ameircan Airlines Group. Plus, the pay scales for the combined workforce would be better than what AMR negotiated with its unions, and what US is currently paying its unionized workforce.
 
RyanairGuru
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 3:36 pm

Quoting 1400mph (Reply 27):
Are we saying that AA should not be permitted to merge with U.S Airways because they are becoming successful / profitable again ? Sorry but that's just f-ing ridiculous.

Business is all about success and making money. If AA and US together will be more successful and make more money then that should be viewed as a good outcome.

Some of you may wish to flatter AA / US with the notion that together they will take over the world and totally dominate commercial aviation forever but that is equally ridiculous and a rather poor excuse to inhibit progress in favour of personal agendas.

      

My God, did 1400mph and I just agree on something? The world might just be about to end  
Worked Hard, Flew Right
 
commavia
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 4:48 pm

Quoting ultrapig (Reply 26):
AA is making an operational profit. That's good. It means that when you take the gross revenue from fares and fees and subtract the operating cost and depreciation there is a big plus number.

But in a company operating outside of Chapter 11 you would then deduct interest cost to get the net income.

A Company in Chapter 11 is not paying interest.

I would be interested to see a SFAS or language from the bankruptcy code that substantiates this.

Profit and loss are income statement numbers, and thus based upon accrual accounting. And I see absolutely no reason why accrual accounting would stop in bankruptcy. As such, I fail to see how the above logic would impact AMR's profit number in any material way. Whether AMR pays interest is meaningless to the booking of an interest expense - that would affect cash flow, not the profit. If an interest expense was incurred, it was booked as an expense against revenue in the calculation of profit. Now certainly - as AMR has renegotiated debt at lower interest rates, that is certainly reduce interest expense, but it hasn't absolved AMR of its interest expense altogether.

And as for "profit" - AMR was solidly profitable in June and July not just on an operational basis, but also on a net basis.

Quoting 1400mph (Reply 27):
Are we saying that AA should not be permitted to merge with U.S Airways because they are becoming successful / profitable again ? Sorry but that's just f-ing ridiculous.

I tend to agree. I understand why this news might lead some, for understandable reasons, to question the "need" for a merger, and I certainly know that it this will be used by politicians and bureaucrats to justify their campaign to kill the merger. But I don't really see what one has to do with the other. Someone please correct me if I'm wrong - but I don't believe AMR has ever said that it "needs" this merger or else will collapse. Indeed, quite the opposite. And I know for a fact that Doug Parker has said repeatedly and unequivocally that US will be just fine without a merger. The key question here isn't whether either or both airlines would survive without a merger, but whether or not the airlines, and customers, would benefit from such a merger. I realize that in the past the whole "failing carrier" argument - "either let us merge or one of us will go out of business" has come into play in regulatory reviews. But in this upcoming trial, I don't see how that's relevant.
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 4:50 pm

Quoting RyanairGuru (Reply 29):
My God, did 1400mph and I just agree on something? The world might just be about to end

 
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Tue Aug 27, 2013 5:24 pm

Quoting 1400mph (Reply 23):
You may spin it whichever way you wish

Not spin, you appear to be saying that a business must have the ability to mandate that folks pay their prices even when competitors exist with lower prices, if a competitor is able to offer lower prices how is that an industry problem?
But a topic for another thread.

Quoting 1400mph (Reply 23):
They're all doing it so what do you suggest to stop it ?

Absolutely nothing, let them all merge with the caveat that when they do get into trouble, no one makes the argument that they are too big to fail and use tax payers money to bail them out, which is where we are heading.

Three legacies can command higer prices on the domestic market as long as they can limit LCC competition, and even without it, there is a limit to how much pax will pay before they hit the road, everyone does not have to get where they are going overnight.
You never know, it may ultimately result in Americans now taking more of their vacation time verus the current trend, recent survey seem to indicate that the Americans do not take their vacation they way others do, and most only get two weeks.
 
ca2ohHP
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 3:08 am

Quoting RyanairGuru (Reply 14):
And who's to say they won't? It will take an army of lawyers a very long time to work through the complaint and come up with detailed and defensible positions, so in the mean time they have basically said "we disagree, and will get back to you later with more information". And it's not just US, but AA as well.

My original point is that US Airways initial reaction to the DOJ lawsuit is like me expecting a police officer to rip up a speeding ticket because I threatened them. They were so sure of it they were holding regular combined meetings at AA-HDQ, adjusting flight schedules (PHX-MIA/FLL), relocating management, etc... (not to mention Parker threatening to yank DCA-secondary markets if he had to surrender slots). Even if that's inevitable, why would you come out so combative before having DOJ blessing? Talk about putting the cart before the horse. AA's executives were so against this, I wouldn't be surprised if they hand delivered the DOJ evidence that will be used against US/AA in the end.

The fact that US/AA is lawyered to the gills means squat. Had they reacted to the lawsuit as being "very concerned, we need to sit down and discuss our differences," I would imagine the DOJ would be a bit more receptive.
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 6:30 am

Quoting par13del (Reply 32):
Not spin, you appear to be saying that a business must have the ability to mandate that folks pay their prices even when competitors exist with lower prices, if a competitor is able to offer lower prices how is that an industry problem?
But a topic for another thread.

There are not really any competitors offering lower prices on any inter-continental route anywhere in the world. The products are all totally different.

For example LHR. You pay a premium to fly out of LHR non-stop versus taking a stop in the middle east which invariably is less expensive. It appears that lower prices exist but flying non-stop versus a transit is not the same product. You fly west non-stop out of LHR and fares are all very similar in economy but higher in the front end cabins on VS and BA because they offer so much more to the frequent London based traveller. Again it appears that lower prices exist but you're getting less bang for your buck if you really look at the differences in what is being offered.

Conversely but just as telling - there are four airlines flying between the west coast and Australia. I have not looked but I bet there ain't much between the fares they all offer because in this case the product is the same.

I don't want to see anyone get ripped off or pay over the odds. I just think the airline industry should be able to make a profit that allows it to reinvest, remain sustainable, offer reasonable salaries and employee conditions and yes, offer return to shareholders. Does that make me a villain ?
 
LipeGIG
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 10:43 am

Quoting skipness1E (Reply 6):
Sorry, just for the rest of us. They reneged on their debts, screwed over their suppliers, axed staff salaries and are trading bankrupt against many companies who have to remain solvent, in conclusion, America is a beautifil country????

Can you all please have a wee think about the above?

The most expensive money, is the one that doesn't exist.

Chapter 11 is not perfect, far from that, but allows a giant company to remain on business. Some lose ? Yes, but who in the world do not focus on productivity today ? There's no magic, and to remain competitive you need to keep look into your costs, small , medium or large supplier.

Or they could stop business, axe not salaries but jobs, screwed even more suppliers that could need to axe jobs, and they will not compete against other players (many used the same procedure), which means we all will end up paying higher fares due to reduced competition.

Glad to see good results coming from AA, and i hope they can keep doing well.
New York + Rio de Janeiro = One of the best combinations !
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 12:22 pm

Quoting 1400mph (Reply 34):
There are not really any competitors offering lower prices on any inter-continental route anywhere in the world. The products are all totally different.

Except we are talking about a US carrier, and at present, their largest market in terms of pax and revenue is the domestic USA, not international travel.
Percentage wise they may make more profit on an international fare, but their domestic operations dwarf their international operations, this should be factored when attempting to understand the driving forces behind their business.
US carriers don't have hundreds of A3XX and 737 narrow body a/c to run international flights to the Caribbean, Mexico and Canada.
 
brilondon
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 12:33 pm

Congratulations to AA and its employees on making the airline work. I do believe that this was done with the belief that the merger would happen though and not based on its own.

I must point out for those who claim cargo is huge according to the numbers on this report, cargo plays a tiny part in the profitability of the airline. Cargo proponents explain this to me that cargo is so important but not a huge component of revenue. That is why you don't see separate cargo airline derivatives of the main airlines.
Rush for ever; Yankees all the way!!
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 3:28 pm

Quoting par13del (Reply 36):
Except we are talking about a US carrier, and at present, their largest market in terms of pax and revenue is the domestic USA, not international travel.
Percentage wise they may make more profit on an international fare, but their domestic operations dwarf their international operations, this should be factored when attempting to understand the driving forces behind their business.

A US carrier that shares a market with the 2 biggest airlines in the world ( formed through mergers )

Therefore - bottom line - why the hell shouldn't AA merge with US Airways ? Or is the answer that it was all very well for them to merge when they were burning cash ? Now they're profitable and might actually be a competitive threat to DL and UA..........
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 5:51 pm

Quoting 1400mph (Reply 38):
A US carrier that shares a market with the 2 biggest airlines in the world ( formed through mergers )

Also both of whose domestic markets dwarf their international market.

Quoting 1400mph (Reply 38):
Therefore - bottom line - why the hell shouldn't AA merge with US Airways ? Or is the answer that it was all very well for them to merge when they were burning cash ? Now they're profitable and might actually be a competitive threat to DL and UA..........

DL and UA are profitable because they did exactly what AA is doing now, they went into chpt.11 and lowered their expenses, now it's AA's turn. AA went into chpt.11 for just that.
 
1400mph
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 6:22 pm

Quoting par13del (Reply 39):
Also both of whose domestic markets dwarf their international market.
Quoting par13del (Reply 39):
DL and UA are profitable because they did exactly what AA is doing now, they went into chpt.11 and lowered their expenses, now it's AA's turn. AA went into chpt.11 for just that.

Exactly. I agree. All is fair in love and war then.

It's very good news that AA is back in the black but it shouldn't be used as a reason to deny them progressive practices used by their counterparts. That's all I'm saying. That would be totally warped.
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 8:45 pm

Quoting 1400mph (Reply 40):
Exactly. I agree. All is fair in love and war then.

Yep, the arbitor of the war finally realised that something was up and essentially made major modifications to the chpt.11 laws, which I still think is a item some are overlooking. AA has already been in almost two years, the merger process is essentially negating one of the major changes to the law, which is to set a time limit on how long an entity can perform what can be called "protected operations"
 
flyfree727
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 8:52 pm

In a dream I see DOJ successful in their attempts. AA or US liquidates, and UA and DL raise the fares through the roof because there is no other competition/alternative for pax. Oh how ironic that would be in the face of DOJ.. Fares skyrocketing, exactly what they wanted to avoid.. think tarmac delay fines.. Yes, large fines for delays, but the fines are rare.. what is more common are flt cancellations to avoid the delays. who ultimately wins? Then I wake up.

AA ORD
 
ECAMActions
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 9:23 pm

Quoting flyfree727 (Reply 42):
In a dream I see DOJ successful in their attempts. AA or US liquidates, and UA and DL raise the fares through the roof because there is no other competition/alternative for pax. Oh how ironic that would be in the face of DOJ.. Fares skyrocketing, exactly what they wanted to avoid.. think tarmac delay fines.. Yes, large fines for delays, but the fines are rare.. what is more common are flt cancellations to avoid the delays. who ultimately wins? Then I wake up.

Not surprising given the doj and who pulls the strings (Obama/Holder).

Neither of them know anything about how to run is business or the free market economy.
 
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par13del
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 9:49 pm

Quoting flyfree727 (Reply 42):
AA or US liquidates, and UA and DL raise the fares through the roof because there is no other competition/alternative for pax.

What you overlook are the airports where these carriers operate, a lot of them are "complicit" in not "allowing" LCC competition while kowtowing to the legacies, if AA or US were to fold up how long do you think it would be before the likes of WN, NK, B6, AS are courted to offer service and pick up the slack?

Imagine MIA without AA or PHK without US, massive airports with little activity from DL and UA so what do they do with all those gates, restaurants, shops etc and other airport activity which is a major source of revenue for the city?

Airlines are not an economic entity all to themselves, and most do not have the dominant position they hold at various hubs without the input and assistance of others.
 
flyfree727
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 10:30 pm

Quoting par13del (Reply 44):
Imagine MIA without AA or PHK without US, massive airports with little activity from DL and UA so what do they do with all those gates, restaurants, shops etc and other airport activity which is a major source of revenue for the city?

That's easy.. They close up and shut down! In the past, this has been the case. During strikes by airline employees, shops, restaurants, vendors, etc have closed because there were NO passengers in the terminals spending money.


Quoting par13del (Reply 44):
, if AA or US were to fold up how long do you think it would be before the likes of WN, NK, B6, AS are courted to offer service and pick up the slack?

As quick as they could get the resources to do so.. It wouldn't be over night, and in the interim , the airlines that were offering service would be able to do so at a premium fare.

AA ORD
 
ECAMActions
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 11:14 pm

Quoting ORDBOSEWR (Reply 2):
And these results only help the DOJ in the lawsuit against US-AA.

Doubtful, one months profit doesn't mean anything especially considering how well the industry has done. The only thing that will help the DOJ at this point is to have an unreasonably long delay to trial like they are requesting.
 
etops1
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RE: American Airlines July Profit Doubles To $292M

Wed Aug 28, 2013 11:36 pm

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