American Airlines: Miami will not suffer disproportionately in cuts

Feb. 07--American Airlines may not know for weeks how many South Florida employees will lose their jobs under a proposal to lay off 13,000 people across the company, representatives said Monday.

In a meeting with The Miami Herald editorial board, executives from one of the county's largest private employers reiterated their commitment to growing business in Miami while outlining the company's plan to emerge quickly from bankruptcy reorganization. American, along with parent company AMR and affiliate American Eagle, filed for bankruptcy in November.

Kevin Cox, vice president of state and community affairs for the Fort Worth-based airline, said American hopes to exit bankruptcy within a year.

The company last week released a proposal to bring in $1 billion in annual revenue and save $2 billion a year in an effort to become profitable again. American has lost more than $10 billion in the last decade.

Savings are expected to come mainly from cutting labor costs, including laying off 13,000 employees, as well as grounding older planes, restructuring debts and leases and other measures. The airline has found it difficult to compete with other carriers who lowered labor costs through bankruptcy reorganization over the last several years.

Unclear still is the future of the airline's relationship with the Miami Heat's downtown Miami home, the AmericanAirlines Arena. Reached in 2000, the deal is worth $42 million over 20 years.

Cox said the company has had discussions on all of its contracts, but said "we're not in a position to discuss that at this point."

The company hopes to increase revenues in part by adding flights and switching to a newer and more cost-efficient fleet of planes.

Plans call for 20 percent growth across the airline's five major domestic hubs, including Miami.

"Obviously Miami has been a wonderful growth opportunity for us, and we would expect Miami to receive its fair share of that 20 percent -- if not more," Cox said.

Still, he and other representatives including American's Miami-based senior vice president, Peter Dolara, acknowledged that job losses here are inevitable. American employs about 9,000 people in South Florida.

"We do not have a level of detail that I know everybody would love for us to have in terms of the impact," Cox said. "But I can tell you this: Miami will not be disproportionately impacted."

A local Transport Workers Union leader said last week that he anticipates nearly 700 workers on the ramp at Miami International Airport and another 100 between Fort Lauderdale and Tampa could be impacted.

But since union negotiations have only recently started again and workers with more seniority could chose to move to Miami, taking the place of employees who are newer, Cox said actual numbers are difficult to reach.

He pointed out that fleet service jobs -- such as cleaning planes between flights and working on the ramp -- will likely be outsourced locally rather than eliminated altogether. But, he said, the company will try to help employees who have lost their jobs get new ones with contractors.

"We hope to be able to transition those men and women over to another company that just does it better, more efficiently, than we are able to do under our current work rules," he said.

While cutting now, the airline hasn't ruled out growth through acquisition after emerging from bankruptcy proceedings.

Chief Executive Officer Tom Horton told Bloomberg News the company may try to buy a rival in the future.

Horton refused to identify any potential acquisition targets and played down the risk of a takeover by US Airways.

"It's not hard to envision how we could be a force in the industry and, potentially, a consolidator," Horton said in an interview at Bloomberg's New York headquarters. "I don't think we need to combine with anybody, but I think there will be ample opportunities to."

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