American faces pilots' walk-out
Tuesday 11 February 1997
American, which is seeking regulatory approval of its proposed partnership across the Atlantic with British Airways, has warned that a walk-out would cost it in the region of $1bn (pounds 610m) a month, which would wipe out recent profits.
Unless a settlement is achieved at so-called "super-mediation" talks in Washington DC under federal government auspices, the pilots' union, the Allied Pilots' Association, has vowed to declare a strike at midnight this Friday. Union officials have put the likelihood of a strike at about 50-50.
A strike could have a damaging ripple effect throughout the US economy. American accounts for about 20 per cent of US passenger travel and has a large share of freight and mail traffic. Most concerned are cities that are American hubs, like Miami, Chicago and its home base, Dallas-Fort Worth.
It would also cast a chill over the Caribbean and Latin America, two regions where American is the pre-eminent US carrier.
In preparation for the worst, American has already prepared redundancy notices for 90,000 employees who would be placed on emergency unpaid leave. Also grounded would be American Eagle, the carriers commuter subsidiary.
The company, which is headed by the irascible Robert Crandall, has also drawn $1bn from an existing credit line and borrowed an additional $1bn - with its entire fleet as collateral - to provide it with a cash cushion to ride through a strike.
At issue is the pilots' demand for an 11.5 per cent pay rise over the four-year life of a new contract. American, which reported record profits in 1996, is offering 5 per cent. "We are faced with two disastrous alternatives - unacceptably high costs or cessation of operations," Mr Crandall wrote in a memo to employees.
For travellers, it is a nightmare scenario. Friday also marks the start of a public holiday, the "President's Day" weekend, and the start of half- term for many schools. A strike could leave thousands of travellers either unable to travel or stranded away from home.
- 1 Stamford Hill council removes 'unacceptable' posters telling women which side of the road to walk down
- 2 Kim Kardashian 'nude pictures' leaked on 4chan weeks after Jennifer Lawrence 'The Fappening' scandal
- 3 Scottish referendum 'English question': Tory MPs call on David Cameron to create an English first minister in wake of No vote
- 4 Iranian blogger found guilty of insulting Prophet Mohammad on Facebook sentenced to death
- 5 Free U2 album: How the most generous giveaway in music history turned into a PR disaster
Stamford Hill council removes 'unacceptable' posters telling women which side of the road to walk down
Kim Kardashian 'nude pictures' leaked on 4chan weeks after Jennifer Lawrence 'The Fappening' scandal
Iranian blogger found guilty of insulting Prophet Mohammad on Facebook sentenced to death
Hitler’s former food taster reveals the horrors of the Wolf’s Lair
Jennifer Lawrence 'naked sex video' will be leaked next, threatens 4Chan celebrity photo hacker
Scottish independence referendum: A nation divided against itself
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Archbishop of Canterbury admits doubts about existence of God
Portuguese academic says British are 'filthy, violent and drunk'
iJobs Money & Business
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...
£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...