American Airlines had filed for bankruptcy last November and is now ready to lay off nearly 13,000 employees or 16 percent of its work force. American Airlines plans to cease its pension plans. It also wants to cut back health benefits for current employees and retirees. Over all, American Airlines is looking to cut employee costs by 20 percent.
Industrial magazines have reported that the 13,000 job cuts include 1,400 management and support staff; 400 pilots; 2,300 flight attendants; 4,600 maintenance (apparently the most heavily affected operation of the carrier) and related; and 4,200 fleet service and other TWU employees; NBC News confirmed early Wednesday afternoon.
American Airlines’ plan to save billions of dollars
Well, American Airlines has much higher plans to save billions of dollars and close the Fort Worth Alliance maintenance hub as part of a five-year plan to save $3 billion per year. While the American Airlines has plans to get rid of all of its maintenance jobs at the facility, the fate of tens of thousands of other jobs at the same location remain unclear. Chairman and CEO of American Airlines, Thomas W. Horton, released a letter to employees Wednesday highlighting the major changes designed to help the carrier emerge from bankruptcy a stronger airline.
Thomas Horton also said in his statement to a business magazine, “The American Airlines hopes to return to profitability by cutting spending by more than $2 billion per year and raising revenue by $1 billion per year”. AMR lost $884 million in the first nine months of 2011, and $904 million for December alone. It has lost more than $11 billion since 2001.
Laura Glading, president of the Association of Professional Flight Attendants said, “The proposal was more drastic than she expected. She claimed that the annual reduction in employee costs, which AMR put at $1.25 billion, would be closer to $2.8 billion”.
American Airline’s maintenance facilities
The airline has a long-term lease for the facility, which sits on 202-acres of land. The airline has operated out of the facility for the past 23 years. A maintenance facility in Tulsa, Okla., will remain open but will lose up to 2,000 of its 6,800 jobs.
Christina Weeks, vice president of communications for Fort Worth-based Hillwood Properties said, “It’s too early to understand how this will impact the 17,000-acre AllianceTexas development. American Airlines has been a valued customer for more than 20 years and was a catalyst that brought 265 companies and 30,000 employees out here. As much as we value the facility, corporate residents come and go as the market dictates and AllianceTexas will remain strong.”
News of the job cuts, to be carried out by American Airlines, which were expected when the company entered bankruptcy, did not sit well with the unions. American Airlines offered no timeline as to when it intends to shut down the Alliance base. It will definitely remain a grave reality for the workers, especially some of who have been laid off before and now face further turmoil.