RVR800
24th Oct 2001, 16:37
AMR, the parent of the world's largest carrier American Airlines, has reported a $414m net loss in the third quarter, despite a half-billion-dollar bail-out package from the US government after the September attacks.
Even before 11 September, AMR had warned that a slump in business travel due to the US economic slowdown and high fuel prices meant it was likely to post a loss for the 2001 second half and for the full year.
Before special charges of $397m for the attack and a credit of $508m from the US government, AMR's net loss was $525m compared with a net profit of $322m in a year earlier.
American Airlines cut 20,000 jobs in the immediate aftermath of the attacks in an attempt to cut costs.
American losses
The anticipated pre-attack losses worsened as planes flew less than half full immediately after the attacks.
AMR said operating revenues fell to $4.8bn from $5.3bn a year earlier.
Some airlines say traffic is still only about two-thirds of normal.
AMR said every company official had taken a voluntary pay cut, and that its board of directors will take no compensation for the rest of 2001.
American Airlines surpassed United Airlines to become the world's largest airline after AMR acquired TWA in April.
United losses
Meanwhile, officials of United Airlines' parent company will meeting after a letter from chief executive James Goodwin to staff sent the airline's stock plunging.
United officials declined to say whether the board was considering replacing Mr Goodwin, despite widespread industry speculation.
Unions representing United workers have called for his resignation when the company's stock fell more than 20% last week after Goodwin wrote to employees that the airline was haemorrhaging cash and "will perish" sometime if it does not cut its losses.
United, like American, was in deep trouble before the attacks because of a severe downturn in business travel.
Analysts expect United to report a quarterly loss of more than $1bn when it releases third-quarter results on 1 November.
Even before 11 September, AMR had warned that a slump in business travel due to the US economic slowdown and high fuel prices meant it was likely to post a loss for the 2001 second half and for the full year.
Before special charges of $397m for the attack and a credit of $508m from the US government, AMR's net loss was $525m compared with a net profit of $322m in a year earlier.
American Airlines cut 20,000 jobs in the immediate aftermath of the attacks in an attempt to cut costs.
American losses
The anticipated pre-attack losses worsened as planes flew less than half full immediately after the attacks.
AMR said operating revenues fell to $4.8bn from $5.3bn a year earlier.
Some airlines say traffic is still only about two-thirds of normal.
AMR said every company official had taken a voluntary pay cut, and that its board of directors will take no compensation for the rest of 2001.
American Airlines surpassed United Airlines to become the world's largest airline after AMR acquired TWA in April.
United losses
Meanwhile, officials of United Airlines' parent company will meeting after a letter from chief executive James Goodwin to staff sent the airline's stock plunging.
United officials declined to say whether the board was considering replacing Mr Goodwin, despite widespread industry speculation.
Unions representing United workers have called for his resignation when the company's stock fell more than 20% last week after Goodwin wrote to employees that the airline was haemorrhaging cash and "will perish" sometime if it does not cut its losses.
United, like American, was in deep trouble before the attacks because of a severe downturn in business travel.
Analysts expect United to report a quarterly loss of more than $1bn when it releases third-quarter results on 1 November.