American Airlines shares tumble 18 percent on outlook


(Reuters) - Shares of American Airlines parent AMR Corp (AMR.N) fell more than 18 percent on Monday as analysts debated the prospects for a bankruptcy filing for the third- largest U.S. airline, which lags its industry peers.

Airline stocks were down broadly on concerns that a weak economy will drain travel demand and hit fares this autumn.

But American, seen financially as the weakest major carrier, saw the worst share losses on a percentage basis. The stock was down 15.9 percent, or 47 cents, at $2.49 on the New York Stock Exchange.

"When can they stop the bleeding of cash?" asked Basili Alukos, an equity analyst at Morningstar. The carrier had a second-quarter net loss of $286 million, while rivals showed profits.

"If it appears we're coming into somewhat of a rough patch or slowdown, how is that going to fare for them?" Alukos said. "I don't think very well, because they were unable to generate a profit kind of in the best of times for the airlines last year."

Ray Neidl, a senior aerospace sector analyst with Maxim Group, said in a recent research note that: "Some believe that a prepackaged bankruptcy filing would be the best thing for AMR and the industry."

An AMR spokesman did not immediately respond to a request for a comment on the bankruptcy talk.

American is the only major carrier that did not restructure in Chapter 11 during the recent industry downturn. As a result the airline has operating costs -- including labor -- that are higher than competitors.

Meanwhile, experts warn that an economic downturn could hit travel demand just as airlines are beginning to recover.

The International Air Transport Association on Monday said airline traffic slowed in August compared with July, with the total passenger market down 1.6 percent.

Shares of United Continental Holdings (UAL.N) were down 9 percent at $17.64 on the New York Stock Exchange. Delta Air Lines' (DAL.N) shares fell 7 percent to $6.99 on the NYSE.

anthonyC previously said:



Another case of the law of unintended consequences. Other airlines get government bailouts but the company that does the right thing is forced to suffer.

abc200 previously said:

US is stupid they need to kill these b.. airlines with their high fairs - let in Ryan and an efficient Asian airlines that invest in good fleets of modern planes run the services.

North Korea's Air Koryo Is The Worst Airline In The World
Kim Bhasin | Oct. 3, 2011, 10:58 AM | 23,271 | 8

There's only one airline in the world that has been deemed horrible enough to earn a dismal 1-star rating from leading airline reviewer SkyTrax.

It's North Korea's state-owned airline: Air Koryo.

It boasts a fleet of less than two dozen Russian-made planes and offers flights to China, Russia, Switzerland, Bulgaria, Hungary, the Czech Republic and more, according to the Centre of Aviation. The planes are based in the Sunan International Airport in Pyongyang.

But in an industry already suffering from widespread negative perception, what makes Air Koryo stand out as the very worst? Customer service, food, safety or a little bit of everything?

Australian biomedical engineer Mark Fahey recently took a flight to Pyongyang and put up some shots of his trip on Flickr. We compiled his pictures along with a few others who documented their flights to show you what it's like on Air Koryo.

abc200 previously said:


Air France has A 3080

A380 engine problem 'could cause fire'
October 3, 2011 - 10:45AM

A buildup of heat in the pylons of A380s equipped with Rolls-Royce Trent 900 engines could cause a fire, the European Aviation Safety Agency said. Photo: Craig Abraham

Airlines operating Airbus's A380 superjumbo may be required to modify equipment that connects the plane's engines to its wings, safety regulators said, citing a risk of overheating that could cause a fire.

Test flights revealed a buildup of heat in the pylons of A380s equipped with Rolls-Royce Trent 900 engines, the European Aviation Safety Agency said today in a proposed airworthiness directive which would require carriers to install ventilation holes in some of the panels covering the structures.

"This condition could, in case of a heavy fuel leak, lead to an ignition of fuel vapors, possibly resulting in a fuel fire and consequent damage to the aeroplane and/or injury to its occupants," EASA said in the directive, which is open for consultation until October 28. If made mandatory, the modifications would have to be implemented within a 10-month period, it said.
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Qantas grounded its A380s for 23 days last year after a Trent 900 failure prompted an emergency landing in Singapore on November 4. Rolls-Royce has since carried out modifications to address issues with a faulty oil pipe, and the glitch disclosed today is unrelated, Airbus said.

The planned directive would affect the Trent-equipped -841 and -842 variants of the A380, all manufacturer serial numbers, except for planes that have already been modified, EASA said.

Today's proposal follows a bulletin issued by Airbus to A380 operators on July 25 after the manufacturer uncovered the overheating issue during its own test flights, spokesman Stefan Schaffrath said by phone, adding that the EASA directive is a standard response. Schaffrath said that the period permitted to address the problem indicates the low perceived risk.

EASA said no-one was immediately available to comment further, and London-based Rolls-Royce declined to comment.

anthonyC previously said:




I agree. We should support abc's perfect model for Asian efficiency and service.



Click here to see pictures of Air Koryo
http://www.businessinsider.com/north-korea-air-koryo-airline-1-star-2011-9#air-koryo-is-not-quality-approved-and-has-1-star-general-ratings-almost-across-the-board-from-skytrax-1

guillermone previously said:

Man it is hard to believe AA has a cash flow problem and is on the verge of bankruptcy. There tickets are not what one would call exactly cheap, pretty much offer the same cut rate service as all the rest of the budget airlines.

guillermone previously said:

Man it is hard to believe AA has a cash flow problem and is on the verge of bankruptcy. Their tickets are not what one would call exactly cheap, pretty much offer the same cut rate service as all the rest of the budget airlines.