Tag Archives: American Airlines Group

Bombardier delivers the first CRJ900 to American for PSA Airlines

Bombardier Aerospace (Montreal-Mirabel) has delivered the first of 30 enhanced CRJ900 NextGen aircraft to American Airlines Group Inc. (Dallas/Fort Worth). The aircraft will be operated by American Airlines Group wholly owned subsidiary PSA Airlines, Inc. (Dayton) under the American Eagle brand. The purchase agreement for the aircraft, which was announced in December 2013, also included options on an additional 40 CRJ900 NextGen aircraft.

The pictured Bombardier CRJ900 (CL-600-2D24) N547NN (msn 15317) was delivered on June 5.

PSA Airlines currently operates as an US Airways Express operator.

Previously the aircraft was unveiled to American Airlines employees and PSA Airlines employees at Dallas/Fort Worth International Airport and in Dayton, Ohio.

American Airlines is the first customer to take delivery of the enhanced CRJ900 NextGen regional jet, which provides up to 5.5 per cent fuel burn reduction over earlier-generation CRJ900 aircraft.

The delivery ceremony at Bombardier’s Mirabel, Québec, facility was attended by senior executives and employees of American Airlines, PSA Airlines, Bombardier and major suppliers to the CRJ Series regional jet program.

As of March 31, 2014, Bombardier had recorded firm orders for 1,817 CRJ Series aircraft, including 343 CRJ900 and CRJ900 NextGen aircraft. Worldwide, CRJ Series aircraft are in service with more than 60 airlines and more than 30 customers operate corporate variants of the aircraft. The aircraft are operating in more than 50 countries on six continents, and on average, a CRJ aircraft takes off every 10 seconds somewhere in the world. CRJ Series aircraft have transported more than 1.4 billion passengers and have logged more than 39 million flight hours and over 32 million takeoffs and landings.

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Judge approves the American Airlines Group-DOJ settlement

According to Reuters, a federal judge on Friday (April 25) formally approved the November 2013 settlement between the U.S. government (Department of Justice) and American Airlines (Dallas/Fort Worth) and US Airways (Phoenix) that merged to form the new American Airlines Group (Dallas/Fort Worth), now the world’s biggest airline group.

Read the full report: CLICK HERE

Copyright Photo: Jay Selman/AirlinersGallery.com. US Airways’ former Star Alliance painted Airbus A319-112 N701UW (msn 890) is now painted in full American Airlines colors. N701UW, operating as an US Airways flight, arrives at the Charlotte hub.

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American Airlines Group reports a record first quarter net profit of $480 million

American Airlines Group (American Airlines and US Airways) (Dallas/Fort Worth) today reported its first quarter 2014 results.

First quarter 2014 net profit was a record $480 million. This represents a $777 million improvement versus the company’s combined first quarter 2013 net loss of $297 million.

Excluding net special credits, the company reported a record first quarter net profit of $402 million. This represents a $340 million year-over-year improvement versus the company’s combined net profit of $62 million excluding net special charges in the first quarter 2013.

First quarter 2014 pretax margin excluding net special credits was 4.1 percent, a 3.6 point year-over-year improvement.

The company ended the quarter with $10.6 billion in total cash and short-term investments. Since the close of the merger, the company has used more than $542 million of cash to reduce its diluted shares outstanding by approximately 20 million.

For the first quarter 2014, American Airlines Group reported a record GAAP net profit of $480 million. This compares to a net loss of $341 million in the first quarter 2013. The company’s GAAP results for the first quarter 2013 reflect AMR Corporation prior to the merger.

The company believes it is more meaningful to compare year-over-year results for American Airlines and US Airways on a combined basis, which is a non-GAAP formulation that combines the results for AMR Corporation and US Airways Group. Therefore, it includes the results of US Airways Group for the full period. See the accompanying notes in the Financial Tables section of this press release for further explanation of this presentation, including a reconciliation of GAAP to non-GAAP financial information.

First quarter 2014 net profit excluding net special credits was a record $402 million. This compares to a combined non-GAAP net profit of $62 million excluding net special charges for the same period in 2013. Excluding net special credits, first quarter 2014 diluted earnings per share was $0.54.

“We are very pleased to report a record profit in our first full quarter as a merged company,” said Doug Parker, CEO of American Airlines Group. “Our team of dedicated professionals did an excellent job of taking care of our customers despite particularly difficult weather conditions throughout the quarter. We are excited for the future and expect our synergies to build as we continue to integrate our operations.”

Merger Integration

Since closing the merger on December 9, 2013, the company has made significant progress in integrating American Airlines and US Airways. Key accomplishments:

Launched the world’s largest codeshare, offering customers improved access to the company’s global network by allowing them to book flights on both airlines’ networks

Provided reciprocal benefits for airport lounge and frequent flyer elite members, including priority check-in, waiving fees for checked bags, complimentary access to preferred seats, priority security lines, early boarding and priority baggage delivery

Enabled AAdvantage® and Dividend Miles® members to earn and redeem miles when traveling across either airline’s network

Joined operations at 58 airports, including Phoenix and Miami hubs

Moved US Airways into the oneworld alliance on March 31 and to the trans-Atlantic joint venture with American, British Airways, Iberia and Finnair on April 3

Aligned award travel options, checked baggage policies and inflight services for First and Business Class customers

Announced Sabre as the new Passenger Services System for the combined company

Closed the sale of the slot divestitures required by the U.S. Department of Justice at Ronald Reagan Washington National Airport (DCA). In total, the company received $381 million in cash from the DCA sales and the sale of slots at New York’s LaGuardia (LGA) Airport, which closed in the fourth quarter 2013.

Revenue and Cost Comparisons

On a combined basis, total revenues in the first quarter were a record $10 billion, up 5.6 percent versus the first quarter 2013 on a 2.0 percent increase in total available seat miles (ASMs). Driven by a record yield of 17.03 cents, up 3.2 percent year-over-year, combined consolidated passenger revenue per ASM (PRASM) was also a record for the first quarter at 13.67 cents, up 2.9 percent versus the first quarter 2013.

Total combined operating expenses in the first quarter were $9.3 billion, down 0.3 percent over first quarter 2013. Combined first quarter mainline cost per available seat mile (CASM) was 13.50 cents, down 2.7 percent on a 2.7 percent increase in mainline ASMs versus first quarter 2013. This cost improvement was largely due to a 4.8 percent decrease in year-over-year mainline fuel prices. Excluding special charges, fuel and profit sharing, mainline CASM was up 4.0 percent compared to the first quarter 2013, at 8.96 cents. Regional CASM excluding special charges and fuel was 16.62 cents, up 5.0 percent on a 3.2 percent decrease in regional ASMs versus first quarter 2013.

Liquidity

As of March 31, 2014, American had approximately $10.6 billion in total cash and short-term investments, of which $947 million was restricted. The company also has an undrawn revolving credit facility of $1.0 billion. Approximately $750 million of the company’s unrestricted cash balance was held in Venezuelan bolivars, valued at the weighted average applicable exchange rate of 6.32 bolivars to the dollar. This includes approximately $94 million valued at 4.3 bolivars, approximately $611 million valued at 6.3 bolivars and approximately $45 million valued at 10.7 bolivars, with the rate depending on the date the company submitted its repatriation request to the Venezuelan government.

In the first quarter of 2014, the Venezuelan government announced that a newly-implemented system (SICAD I) will determine the exchange rate (which fluctuates as determined by weekly auctions and at March 31, 2014 was 10.7 bolivars to the dollar) for repatriation of cash proceeds from ticket sales after January 1, 2014, and introduced new procedures for approval of repatriation of local currency. The company is continuing to work with Venezuelan authorities regarding the timing and exchange rate applicable to the repatriation of funds held in local currency. The company is monitoring this situation closely and continues to evaluate its holdings of Venezuelan bolivars for potential impairment.

Since the merger, the company paid $542 million in tax withholdings for employees in lieu of issuing shares of common stock as compensation as permitted under the Plan of Reorganization, thereby reducing the number of shares expected to be issued under the Plan by approximately 20 million. Additionally, the company has elected to utilize the cash settlement feature for the remaining $22 million principal amount of US Airways Group 7.25% convertible notes due May 15, 2014, which will further reduce diluted shares by approximately 4 million shares.

Special Items

In the first quarter, the company recognized a combined total of $78 million in net special credits, including:

$137 million in net special credits consisting primarily of the gain on the sale of slots at Reagan National Airport offset in part by integration and merger-related expenses

$47 million in non-operating special charges due primarily to non-cash interest accretion on bankruptcy settlement obligations

$8 million in non-cash deferred income tax provision related to certain indefinite-lived intangible assets

$4 million in regional non-operating charges

Additional Integration Related Developments

Distributed $11 million to employees for baggage handling and on-time performance in the month of January; this distribution of $100 per employee is part of the company’s Triple Play program which measures on-time arrivals and baggage performance as reported in the DOT’s Air Travel Consumer Report (ATCR)

Conducted first joint Captain Leadership Training with newly promoted captains from both airlines

On April 9, Piedmont flight attendants ratified a new five-year Collective Bargaining Agreement
Opened a new Admirals Club lounge at the company’s Philadelphia (PHL) hub

Fleet/Network Developments

As part of its plan to modernize its fleet by replacing older aircraft with newer, more fuel-efficient aircraft, the company inducted 12 new Airbus A321 aircraft into service between New York’s John F. Kennedy International Airport (JFK) and Los Angeles International Airport (LAX), and JFK and San Francisco International Airport (SFO). American is now the only U.S. carrier to offer three classes of service between these key markets.

The company also took delivery of one Airbus A330-200 aircraft, five Boeing 737-800 aircraft and one Boeing 777-300 aircraft during the first quarter.

Revealed new Boeing 767-300 and 777-200ER cabin retrofits, which feature lie-flat seats with direct aisle access in Business Class

In April 2014, the company exercised its option to purchase (and thus terminated its existing lease financing arrangements) for 62 Airbus A320 family aircraft scheduled to be delivered between first quarter 2015 and third quarter 2017. In connection with this decision, the company also exercised its right to convert firm orders for 30 Airbus A320 family NEO aircraft (scheduled to be delivered in 2021 and 2022) to options to acquire such aircraft.

Top Copyright Photo: Rolf Wallner/AirlinersGallery.com. American Airlines’ Boeing 767-323 ER N346AN (msn 33085) taxies at Zurich.

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Bottom Copyright Photo: Jay Selman/AirlinersGallery.com. US Airways is now planning to operate the last Boeing 737 revenue flight on August 18 at the Charlotte hub. Boeing 737-4B7 N450UW (msn 24933) arrives back at CLT.

American Airlines and US Airways issue their fleet plans

American Airlines Group (American Airlines and US Airways) (Dallas/Fort Worth) has issued its new fleet update (see below) for 2014. Overall the fleet will grow by only three aircraft this year. The Group will take delivery of 83 new mainline aircraft during 2014, namely 10 Airbus A319s, 42 A321s, three A330-200s, 20 Boeing 737-800s, two 787-8s and six 777-300s (more Airbus aircraft than Boeing aircraft). The Group expects to retire during 2014 26 McDonnell Douglas DC-9-82/83s (MD-80s), 14 Boeing 737-400s, 22 757-200s, 13 767-200s and five Airbus A320s.

The last eight Boeing 737-400s being operated by US Airways (top) are expected to be retired before the end of the third quarter (September 30).

On the regional side, the Group is significantly reducing its Embraer ERJ 140 fleet but it will also operate a large amount of inefficient 50-seat Bombardier CRJ200s (138) and Embraer ERJ 145s (118).

Here is the full report:

In addition, according to Airline Route, American Airlines and US Airways will begin assigning certain routes to either American or US Airways:

Effective June 1: American Airlines routes to be operated entirely by US Airways:

Charlotte – Chicago (O’Hare)
Charlotte – Miami
Los Angeles – Phoenix

Effective July 2, the following American routes will be operated by US Airways:

Miami – Detroit
Miami – New Orleans
Miami – Raleigh
Miami – Tampa

Effective July 2, the following US Airways routes will be operated by American:

Phoenix – Detroit
Phoenix – Newark
Phoenix – Orange County
Phoenix – Seattle

Top Copyright Photo: Bruce Drum/AirlinersGallery.com. A significant milestone is approaching quickly. US Airways has had a long association with the Boeing 737 and the last 737-400 is expected to be retired before the end of September according to this fleet update. Boeing 737-4B7 N433US (msn 24555) taxies to the runway at Charlotte Douglas International Airport (CLT).

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Bottom Copyright Photo: Michael B. Ing/AirlinersGallery.com. American is quickly replacing the older Boeing 767-200 ERs currently being operated between New York (JFK) and Los Angeles with newer Airbus A321s. The last AA 767-200 is expected to be retired on May 7 according to ch-aviation although the type will continue with US Airways into 2015. American Airlines’ Boeing 767-223 ER N335AA (msn 22333) departs from Los Angeles bound for New York (JFK).

Piedmont Airlines’ flight attendants ratify the new contract

Piedmont Airlines’ (2nd) (US Airways Express) (Salisbury) flight attendants, a wholly owned subsidiary of American Airlines Group, represented by the Association of Flight Attendants-CWA (AFA-CWA), have voted to ratify a new five-year collective bargaining agreement that was reached on March 6. The new contract was ratified by the airline’s 180 flight attendants who are based in Harrisburg, PA; Salisbury, MA; Charlottesville, VA; Roanoke, VA and New Bern, NC.

Copyright Photo: Bruce Drum/AirlinersGallery.com. Bombardier (de Havilland Canada) DHC-8-102 N908HA (msn 015) of Piedmont Airlines (2nd) taxies to the runway at the Charlotte Douglas International Airport (CLT) hub.

Piedmont Airlines-US Airways Express:

American Eagle’s ALPA pilots reject the “concessionary contract” by 70%

American Eagle Airlines’ (Envoy) (subsidiary of the American Airlines Group) (Dallas/Fort Worth) pilots, represented by the Air Line Pilots Association (ALPA), have rejected by a 70-30 percent margin the “concessionary contract”. ALPA issued this statement:

American Eagle pilots, represented by the Air Line Pilots Association, Int’l (ALPA) expressed their collective will and on March 28 rejected a concessionary contract proposed by American Airlines Group (AAG). With 92 percent of the eligible pilots casting their ballots, 70 percent voted against ratification of the contract.

“The Eagle pilots made a clear choice today, and it was not an easy one,” said Capt. Bill Sprague, chairman of the Eagle ALPA Master Executive Council. “Despite threats from AAG management that they would seek other express carriers to conduct our flying, today’s vote demonstrates that the demands for contract concessions were not acceptable. Today’s vote clearly shows that pilots can, and will, vote against any agreement that is not in their best interests.”

The proposed contract changes were a combination of pay freezes, reductions in per diem, and increased health-care costs in exchange for a promise to refleet the airline and enhance the existing agreement to transfer pilots to American Airlines. These concessions were in addition to the $43 million the pilots gave the company during bankruptcy last year.

Having previously worked under a 16-year contract that concluded with AMR’s bankruptcy filing, the American Eagle pilots have not seen meaningful contractual gains since 2004. New-hire pilot pay begins at less than $23,000 per year. Had the contract been approved, first officers would have been capped at about $38,000 per year after four years of service.

“Management has said many times to us that this agreement is their ‘bottom line’ offer and believe that they will be able to get the same cost savings from another provider,” Sprague said. “We question whether any regional airline is able to attract and retain pilots by offering poverty-level wages. American Eagle already has a career progression arrangement with American, and yet, due to a lack of pilots, it’s unable to perform the regional flying that American Airlines desires. Other airlines are experiencing the same problem.”

According to Reuters, American Eagle (Envoy) will shrink.

Read the full report: CLICK HERE

Copyright Photo: TMK Photography/AirlinersGallery.com. Will American Eagle Airlines (soon to be Envoy) go the same way as Comair? CEO Doug Parker, with the looming pilot shortage, now has a difficult decision to make as the pilot unions and members are drawing a line on wages and benefits concessions. The next move is from AAG management. The likely outcome is to gradually downsize Envoy and move large regional jet operations to other American Eagle carriers and gradually phase out the 50-seat ERJs currently operated by American Eagle. Bombardier CRJ700 (CL-600-2C10) N536EA (msn 10315) of American Eagle (Envoy) arrives at Toronto (Pearson).

American Eagle-Envoy:

US Airways flight attendants vote to join forces with American Airlines flight attendants

US Airways Flight Attendants, represented by the Association of Flight Attendants-CWA (AFA), voted to ratify an Agreement on Bargaining and Representation between AFA and the Association of Professional Flight Attendants (APFA) along with a Negotiations Protocol Agreement with American Airlines management. The agreement establishes a joint negotiations protocol for a single contract at the New American Airlines with the assurance of improvements in one year for all 24,000 Flight Attendants.

Beginning next week, AFA and APFA will form a joint negotiating team with an equal number of representatives and professional advisors as they spend the next 60 days preparing an opening proposal based on the best of both contracts and input from all Flight Attendants at the New American. Management has agreed to meet for 150 days with an intensive schedule that averages three weeks a month in an effort to reach an agreement on a combined contract. The parties will utilize the mediation services of the National Mediation Board and other expedited bargaining methods. If an agreement cannot be reached, only the open items will be submitted to arbitration based on an economic standard that will produce improvements over the current contracts. The entire process includes timelines that lead to implementation of a new single contract no later than the first quarter of 2015.

The agreement transitions representation for the combined group to the Association of Professional Flight Attendants (APFA). The unions will jointly file a single carrier petition with the National Mediation Board in June, which will lead to certification of APFA as the representative in summer or fall. AFA will continue to work in partnership with APFA until the joint bargaining process is concluded and the new contract is implemented. Even after APFA’s certification, AFA will continue to enforce the current US Airways contract and related grievances.

American Airlines and US Airways expand their code-share agreement

American Airlines (Dallas/Fort Worth) and US Airways (Phoenix) are expanding their code-share agreement to provide customers access to nearly 6,500 daily flights to more than 275 destinations in the combined global network. These additional codeshare flights are now available for booking, for travel starting February 6.

American and US Airways launched the initial phase of their code-share on January 13. This phase extends the code-share to all flights across the combined global network, except for a select few international markets due to regulatory requirements. The two airlines expect to code-share on every international flight in these markets by the end of the first quarter.

Through the code-share, each airline can sell tickets operated by the other carrier using its own code and flight number, and customers will be able to easily combine select flights operated by each airline on a single itinerary when booking travel on aa.com, usairways.com or through travel distribution channels.

Customers should continue to check in for flights and conduct business with the airline operating their flight just as they did before the launch of this code-share.

Copyright Photo: Jay Selman/AirlinersGallery.com. The first US Airways aircraft to be repainted in American Airlines’ 2013 livery is this former Star Alliance Airbus A319-112 N700UW (msn 885) arriving back at Charlotte.

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American Airlines Group considers new destinations from the US Airways Charlotte hub

American Airlines‘ (Dallas/Fort Worth) new CEO (and old US Airways and America West Airlines CEO) Doug Parker stated to the Charlotte Observer and others via a conference call that they plan to add “new dots on the map” for the Charlotte hub. AA executives are now reviewing the combined route map for new opportunities. CLT is now the second largest hub (behind DFW) for the American Airlines Group.

American is also adding more seats to its planes.

Read the full report: CLICK HERE

Copyright Photo: Jay Selman/AirlinersGallery.com. The old met the new at the Charlotte hub. Allegheny Airlines became USAir, later US Airways which merged with American Airlines with US Airways management taking over the “new” American. Airbus A319-112 N700UW (msn 885) of US Airways was the first aircraft to be paint in the new American Airlines brand.

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US Airways puts the first American Airlines painted aircraft into revenue service this morning

US Airways (American Airlines Group) (Phoenix) has painted its first aircraft in American Airlines‘ (Dallas/Fort Worth) 2013 new livery. The pictured Airbus A319-112 N700UW (msn 885), formerly painted in the Star Alliance color scheme (which US Airways is leaving), was placed into revenue service early this morning (January 30) from the Charlotte hub to New York’s La Guardia Airport as flight US 2060.

US Airways issued this statement:

American Airlines today (January 30) entered into service the first legacy US Airways aircraft, an Airbus A319, painted in the American Airlines livery. The newly dressed plane, tail number N700UW, debuted its freshly painted fuselage with service from Charlotte to New York’s LaGuardia Airport on flight 2060.

The Airbus A319 recently spent 13 days receiving its makeover. In anticipation of the new coat of paint, the existing paint was gently removed, the aircraft sanded and washed. Following the metallurgical exfoliation, the seams were sealed, the aircraft masked and 80 gallons of specially chosen paint applied to the exterior. A final detailing was completed to ensure the highest shine before sending the plane out the door and back to work.

This past December, following the close of the merger with US Airways, a survey was launched allowing employees from both airlines to vote whether to change or to maintain American’s current livery. InJanuary 2014 the voting results were announced to keep the new flag tail livery.

The airline will be adding the new look to its entire fleet of aircraft over the next few years. Approximately 640 aircraft are in line to receive the makeover, with newly arriving legacy American Airlines aircraft already outfitted in the new colors and US Airways aircraft delivered in the new colors beginning this June. By the end of second quarter 2014 American Airlines anticipates that more than 275 mainline and regional aircraft will have been painted in the new livery.

Top Copyright Photo: Jay Selman/AirlinersGallery.com. History was recorded early this morning at Charlotte (CLT) by Jay Selman. All US Airways aircraft repainted in American’s colors will have a special “Operated by US Airways” inscription by the front door until the two AOCs are merged into one operating certificate.

Bottom Copyright Photo: Jay Selman/AirlinersGallery.com. Airbus A319-112 N700UW returns to Charlotte today after completing its round trip to and from New York.