American Airlines Warns Employees of Layoffs, Possible Takeover of Airline

The new CEO of AMR, the parent company of American Airlines, told employees this week that more jobs will “most certainly” be cut.

American Layoffs Already Underway

According to Bloomberg, the bleak New Year’s message from Tom Horton wasn’t exactly news to workers since the carrier already laid off 20 pilot trainees this week, and “218 pilots and flight attendants at Eagle’s Executive Airlines were told yesterday that their jobs may be cut by the end of January.”

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Horton, who took over from Gerard Arpey when the company filed for bankruptcy in late November, also warned of the need for what he called “next-generation, competitive labor contracts” which appears to be corporate-speak for “less for labor.”

Other airline executives are also pointing out the need to reduce costs including Southwest CEO Gary Kelly, though he stopped short of suggesting employees would be asked to make any “concessions.”

Southwest Also Warns Employees, ‘Costs are Too High’

American CEO Warns of Merger Attempts

Meanwhile, Horton also warned that American could be seen as a ripe target for a takeover by “opportunists,” though he did not name names.

However, it should be remembered that as far back as April of this year, US Airways CEO Doug Parker spoke about mergers, saying, “There is one big deal left, and that’s with US Airways.” He did not name any potential merger partner, though it’s hard to draw any other conclusion than American. In the past few years there have been mergers between Delta and Northwest, and United and Continental.

Which two legacy carriers are still “single”? American and US Airways.


Published: December 16, 2011