With the ascension of a new chairman and a new chief executive, American Airlines insists it has entered "a new era" and says it is hopeful that bankruptcy can be avoided.
The carrier was able to finalise concessions packages with its major unions, but only after chief executive Don Carty resigned.
Carty had reached deals with the carrier's pilots, mechanics and flight attendants on $1.8 billion in annual labour cost cuts, which the airline says are needed to avoid a Chapter 11 bankruptcy filing.
But the deals unravelled when it was revealed that Carty had failed to disclose during labour negotiations that American's top seven executives had awarded themselves a lucrative retention bonus scheme.
American's unions were outraged and the story became top news in the USA, with Carty portrayed as the latest US corporate executive to engage in dishonest practices.
Carty, who apologised repeatedly and publicly for "mistakes in judgement", was forced to resign by American's board of directors, which named long-standing board member Edward Brennan executive chairman and chief operating officer Gerard Arpey president and chief executive.
With the $1.8 billion in annual concessions in place, Arpey says: "We strive to quickly and diligently rebuild our financial position."
Source: Flight International
