American: Cuts are forever. And ever


You can not smash the omelet after it’s been scrambled. Or, a cut is like a thing of beauty: it’s forever. That the clear statement of American’s top guys, chief executive Gerard Arpey and chief financial officer Tom Horton. Asked what they would do with their announced cutbacks if fuel prices came down, Arpey said, “The capacity reductions we are making are permanent. We are not bringing these planes back.” Any new aircraft would be used to replace the existing fleet, not to add new capacity, he said. In other words, as American’s CFO Horton says, “These cuts are permanent.” American is also moving the retirement date for its A300-600 fleet up by several years and will have all of the very big and quite old ‘Buses out of its fleet by the end of next year.

American plans to remove 10 of the jets this year and the remaining 24 next year. The 34 Airbus jets, which fly out of New York and Miami, are the main fleet for American service to the Caribbean and Central America and also serve South America. They’re the planes that American uses to the Dominican Republic and Haiti, where it carries large amounts of ethnic, or VFR traffic, for instance.

Some of the Airbus flying can be picked up by new Boeing 737-800s to be delivered in 2009, they said. “We’ll be moving planes around to backfill where we need wide-bodies,” Arpey said. “That’s where those airplanes operate today. That doesn’t mean necessarily that we’re pulling down capacity in Miami, for example.”  These cuts are in addition to MD80 retirements (not enough of them, in our opinion) and Saab 340 retirements.,

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