American Airlines files for bankruptcy protection
FORT WORTH, Texas (AP) — The parent companies of American Airlines and its regional affiliate American Eagle are filing for Ch. 11 bankruptcy protection.
AMR Corp. and AMR Eagle Holding Corp. said Tuesday that they filed voluntary petitions to reorganize, saying it's in the best interest of the companies and its shareholders.
American says it sought protection to reduce its costs and debt to remain competitive in the airline industry.
American was the only major U.S. airline that didn't file for bankruptcy protection after the 2001 terrorist attacks.
American says labor-contract rules force it to spend at least $600 million more than other airlines.
No travel disruptions anticipated
For the 240,000 passengers who fly American Airlines each day, the airline's bankruptcy filing should have little noticeable impact.
AMR Corp. said that it will continue normal flight operations as it heads to federal court to restructure. The move is aimed at reducing AMR's hefty costs, including for labor.
Delta, United, Continental and US Airways have all gone through Chapter 11. Travelers continued to book tickets. Planes still took off and landed and frequent flier miles were still earned and redeemed.
The only risk to passengers is if the restructuring fails, the airline ultimately liquidates and ceases to fly. Still, many travelers are protected in that case if they bought tickets with a credit card.