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October 04, 2012

Blog: The sad, "downward spiral of American Airlines"

A strong blog post this morning at Leeham, the site of longtime airline industry observer Scott Hamilton, on the dismal state of affairs at American Airlines.

We’ve been watching with dismay the downward spiral of American Airlines.

This once-great carrier is hardly recognizable any more. It is perplexing to us how a management team that got its training under Robert Crandall and helped create such a great carrier could have gone so wrong.

It's a well written, point-by-point critique of American's strategic errors under Crandall's successors. And it closes with a vote of no confidence in CEO Tom Horton's leadership.

Horton is firm that American won’t merge while in Chapter 11 and it’s pretty clear he doesn’t want to merge at all.

We have no confidence in Horton at the helm, nor in American’s management. If American is to survive, they have to go.

- Bob Cox







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Management 101

“If the employees come first, then they're happy, ... A motivated employee treats the customer well. The customer is happy so they keep coming back, which pleases the shareholders. It's not one of the enduring Green mysteries of all time, it is just the way it works.”
Herb Kelleher quotes (Founder of Southwest Airlines)


That's a pretty damning analysis. It does look like the wheels are coming off the bus at the moment, but who is more to blame for that - AA's management or the pilots who are scaring passengers away with delayed and cancelled flights?

M. Clemens

Finally someone with the reputation of Mr. Hamilton says what the employees have been saying for years,that AA management is incompetent and needs to go. Thank you Mr. Hamilton.


It is a major indictment of the AMR management that they have let everything that is happening to American Airlines to get so out of control. It has reached a point where the bankruptcy judge or the creditors should step in and intervene, stop and prevent the destruction of an industry icon simply because of the incompetence and ineptitude of the management of AMR. At every turn AMR management has sought to unnecessarily antagonize its own employees into open rebellion. Without a major rebranding of American Airlines through a merger with USAirways with new management at the helm, American Airlines will not survive a stand alone exit from bankruptcy for very long. It is mortally damaged. The solution for what American Airlines needs to fix the problem right now is staring everyone in the face. Why is it so hard for AMR current management to make the right decisions and to do the right thing instead of choosing a path that will result in the destruction of an airline icon with a very long and proud history?


This is a little much, I think! With billions in the bank we are not quite dead yet. We have had some problems lately, it's true. But I think we will rebound from this just fine, like Delta and United did.

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