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May 18, 2011

AMR CEO Arpey remarks at shareholder meeting, no decision yet on Eagle

While I may not be in Los Angeles for the meeting (I'm in Dallas at Love Field for Southwest's shareholder meeting), here is a copy of the remarks that AMR chief executive Gerard Arpey said at the meeting.

Arpey said that the company is still considering its options related to the divestiture of regional carrier, American Eagle.

"Our evaluation, which is ongoing, has included many scenarios, including spinning off the enterprise to our shareholders, selling the company to third parties, or retaining ownership while still diversifying our regional feed network. As we finalize our alternatives, we intend to collaborate with our employee groups to hopefully find a solution that meets all parties’ interests while creating a competitive and sustainable regional airline.

"To that end, we have asked Eagle’s CEO Dan Garton to work with Eagle’s pilots union and other groups to develop a range of possible solutions that achieves American’s goals while laying the groundwork for Eagle’s future as a successful regional airline," Arpey said.

Keep reading to see the full comments made by Arpey at the meeting.

-Andrea Ahles


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You can see AA is trying really hard to succeed but they are swimming upstream. I hope they'll be a great and profitable airline again one day once they get their issues worked out.

As for Eagle, selling it might not be a bad idea if the price is right. Can't have too much cash these days, especially if you're an airline.




Cat, what are you talking about? Most of my AA flights are on time and not cancelled. You seem like a bitter employee who doesn't like the airline industry. Maybe it's time to retire.


Scotty, I believe CAT was talking about American Eagle. But that just shows how informed CAT is. American Airlines negotiates with ATC and cancels American Eagle flights to run AA metal on time, then AE gets massive delays for the flights that will run that AA has not canceled. With these cancellations, AA does not pay AE, that is a savings, because every other regional gets paid for these types of cancellations. So if Arpey is not lying to the SEC in there 10K report, AA pays the average for there feed. So why divest AE from AMR if your are already paying the average, not even top dollar. How low can you go to pay for the feed and what about the safety and quality from the low baller. I guess AMR does not care about there paying passengers safety.

Maybe the AMR CEO should look closely how to lower the pay at AA for there pilots, being they have still a pension and paid higher and work less than there peers.

Airline Insider

What I find interesting after reading this meeting transcript is the fact that AA continues to unleash "new" strategies to the public and to investors when they are in reality a reinvention of the same old failed strategies which continue to lose them money........

This "Flight Plan 2020" program is not anything new under any sense of the word. It is a mere reinvention of the "Turnaround Plan" that they unleashed in the early 2000s in an attempt to raise profits and improve labor relations. Clearly, given AA's continued poor financial performance and labor problems, it was shown that the strategy failed miserably. Yet how ironic and disturbing that the AA officers are now selling a failed plan strategy to new markets in an effort to establish new business partners.

Additionally, I find it quite interesting that AA is continuing on its "goodwill" campaign to portray to the public that they somehow really care about the communities they serve. Sadly, given the company's current financial situation, the only thing that AA is concerned about right now and in past years I might add, is raising revenue to stay out of financial ruin. Sadly, they will stop at nothing to achieve that, including exploiting communities in need (aka "Corporate Citizenship") solely to expand their brand thus satisfying the "at all cost" strategy, an inside marketing strategy the public seldom hears about. As in years prior, however, their goodwill campaign will lose credibility just as the Diverse Segment Marketing department did after people in those communities finally realized that they were being exploited and played solely for the benefit of the company.

So I suppose what's next ?? Perhaps AA should try and use a different, more ethical strategy since it is clear that they have just about alienated everyone using the current strategy. Customers are angry as well as employees. Venders and travel agents are severing ties due to exasperation. Communities are deteriorating in their support of AA due to the company's hypocrisy and hidden exploitation agendas. Sadly, it appears that the ship is sinking and they are trying desperately to reach out to those who will have faith enough to save them.

Personally, I feel that they are holding the shareholder meetings in different cities to avoid bad publicity and confrontation from local employees like they received in previous years. Quite an unwise business move on the part of the AMR board since it sends a clear message to the public that they are afraid and unwilling to address tough internal conflicts head-on within the company. And as the old saying goes "Don't poop where you eat"

It will be very interesting to see how it all unfolds.



Regular flier

AA Continues to make bad decisions because it is spearheaded by the WORST management heads in the history of any Corporation. They have had no leadership and no direction since Robert Crandall left. That was the day that American Airlines as the world knew it died.
This airline that is "Somehow existing" is not the same one we all used to know.

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