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AMR Avoids Bankruptcy for Now. What's Next?

By H. Wicai, KWMU

St. Louis, MO – Yesterday the Flight attendants for American Airlines voted to accept $340 million in concessions, which helped American avoid bankruptcy - for now.

Analyst Julie Nieman with RT Jones Capital Equities in St. Louis says to survive long term American and the airline industry have to take a hard look at the Hub system.

The majors really have a fundamental structural problem," she said. "The hub and spoke system doesn't work. You have to be able to eliminate unprofitable routes. You have to rationalize your whole route structure and your whole fair structure.

In the meantime, The concessions accepted by the flight attendants will result in the St. Louis-based staff - largely ex-TWA workers - losing their jobs.

Most of them are faced with imminent furloughs, even those who are in their 50s and 60s, just as they were approaching retirement.

The state has applied for federal money to help retrain American Airlines staff laid off from their St. Louis base.


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