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Shame on American Airlines

Posted Apr 10 2008, 04:10 PM by Robert Walberg
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In the words of Ricky Ricardo, the CEO of AMR Corp. has "some 'splainin' to do."  Whether you believe the parent of American Airlines is merely the victim of a reactionary FAA or not, the fact of the matter is that management had 18 months to comply with the FAA's request regarding the wiring on the MD-80s and failed to act.

Yes, the planes have been flying safely for years, and yes, the FAA is likely overreacting to criticism from Congress after it was made to look inept in the Southwest Airlines debacle a few weeks back. Nevertheless, the single most important task of any airline CEO is public safety. Failing to address a potential safety risk merely because you didn't think you would get caught is a miserable excuse.

Maybe AMR's management simply thought the cost of fixing the problem would be too high -- especially since the FAA really hadn't checked that carefully in the past.  With jet fuel costs skyrocketing and the economy slumping, spending more money on maintenance that didn't seem necessary had to be a tough pill to swallow. So AMR chose not to take its medicine in small manageable doses over the past 18 months in hopes that the problem would just go unnoticed.

Talk about bad decisions. As a result of the CEO's leadership, or lack thereof, AMR has canceled thousands of flights and will be canceling more. The immediate dollar cost of those cancelations is estimated in the tens of millions. But my guess is those estimates will be too low because it's very difficult to measure the loss in customer loyalty -- a cost likely to continue to hurt AMR for years to come.

If it were me stuck at an airport for days because the airline I chose didn't take the steps necessary to secure my safety, I would think long and hard about using that carrier again.  At the very least, I would demand more than a public apology. I would expect a full rebate on my canceled flight, maybe a certificate for a free round-trip within the next 12 months and an assurance that all safety measures had been addressed. Finally, I would want to see the CEO fired.  

Bottom line: This was an inexcusable mistake and one that should cost CEO Gerard Arpey his job. Until this step is taken, I wouldn't just avoid the stock, I would also avoid the airline. I doubt I'm alone.

Comments

 

American should have indeed started these inspections last year. A few flights a day would have solved this problem. Now...they are SOL as fare as their patron go. The CEO should be canned, ASAP, without even a severence pay.

AA has provided atrocious services for years, and is by far one of the worst airlines in this country. Numerous times, I have observed very unprofessional behaviors from AMR employees, including unexplained delays, crew members insulting passengers and very messy airplanes.  Anybody wish to be reminded of the food AA serves?  And that is what we can easily observe: the wiring is out of our sight!  

Shame on you!

My sister was effected by the cancellations - traveling with her 3 children. It took her 3 days to get from Pheonix to O'Hare - she ended up driving from Indianapolis home due to the customer service person telling a man, traveling wiht a small child tring to get home, in front of her stating "Sir, I really don't care" I think American should have done what they needed to do, but now customer service could save them and they outright say THEY DON'T CARE ABOUT THEIR CUSTOMERS -- whatever happened to customer service????

I agree, They had 18months and did nothing till the FAA caught SWA with their pants down. I work for AA and this is no surprise. The S80 are good planes but they need to replace them with the 737........ BUT THE FIX should have been done long ago. I bet Arpey will leave after he receives his bonus this month with the rest of the VP's at AA. That is hard to swallow when you see people stranded at the airport with a useless food voucher and no word from Texas HDQ until it got really bad. This affects everyone passengers, employees, shareholders. Shame on you Arpey!

Agreed.  

And when will AMR wise up and realize the MD-80s are universally hated by passengers!  They are cramped and uncomfortable and lack the entertainment (movie) options other jets offer.

I stopped flying American because of them.

As an employee of American Airlines, I have always said that our current CEO is an accidental CEO who just became the CEO because the former one was a crook.

Unfortunately we today have a CEO who is NO leader, NO visionary, NO credibility and NO support from any employee group. He has over the years proven to be the greatest dissapointment of any CEO in AMR history! This latest maintenance fiasco proves to all that he is indeed not suited for his position. One more point is that American Airlines has a Chief Pilot (the boss of all pilots) managing the flight department who DO NOT fly any airplanes. He is the first chief pilot in AA history not to have maintained any flight qualification! This corporation is SICK. The executive officers are arrogant, greedy and  creating a poisonous and dysfunctional corporate culture.

I FLY ON A REGULAR BASIS AND WHAT I CAN OFFER TO THIS CONVERSATION IS AS FOLLOWS. HAVE YOU FLOWN LATELY? EVERY FLIGHT IS EITHER OVERSOLD OR COMPLETELY FULL. I'M QUITE SURE THAT AS SOON AS THIS ISSUE IS RESOLVED AND THE NEXT BIG NATIONAL ISSUE HITS THE PRESS, EVERYONE EFFECTED BY THIS SETBACK WILL FORGET AND GO RIGHT BACK TO LIFE AS USUAL. DON'T THINK FOR EVEN A MOMENT THAT MAGICALLY THE OTHER CARRIERS ARE GOING TO TAKE UP THE SLACK BECAUSE AMERICAN AIRLINES CUSTOMERS ARE MAD AT THEM. THE PEOPLE EFFECTED BY THIS CURRENT ISSUE WILL GO RIGHT BACK TO FLYING AMERICAN NEXT WEEK WHEN THEY LOOK AT THE PRICE DIFFERENCE AND SCHEDULE DIFFERENCE FROM SAY CONTINENTAL THAT HAS A HUB IN ANOTHER CITY AND THE SCHEDULE IS NOT AS CONVIENIENT. NEXT. WOULD YOU RATHER BE HEARING THAT THEY DIDN'T GROUND THE PLANES AND SOME OF THEM CAUGHT FIRE AND PEOPLE DIED? WE COULD THE CALL FOR THE CEO'S EXECUTION INSTEAD OF SAYING THAT HE NEEDS TO BE FIRED. ALSO, LOOK A THE VALUE OF THE STOCK TODAY. WILL THEY CAN HIM BECAUSE THE STOCK WNT UP 70 CENTS? LOOK AT ALL OF THE FUEL HE DIDN'T USE TODAY AND ALL OF THE PASSENGERS ARE STILL ALIVE. LET'S GET REAL. GET ALL OF THE FACTS BEFORE YOU CALL FOR HIS HEAD. AND REMEMBER, HE HAS A FAMILY ALSO AND I'M QUITE SURE THAT HE WOULD NOT REACT WELL TO SOMEONE PUTTING THEM IN DANGER SO THAT OTHERS COULD GET TO TRAVEL DESTINATION.

Dennis - Under the CEO's leadership, the company failed to respond to the FAA mandate to fix the wiring in the MD80 (which as CeCe mentioned is an awful plane to begin with).  The company could have been systematically grounding flights to fix the problem over the past 18 months.  I'm sure a few flights grounded a day over 18 months would have been much easier for the airline and passengers to digest than thousands in a matter of days.  They simply didn't think the changes would be enforced so they ignored the order.  Don't believe for a minute that the mandate provided by the FAA was too technical for them to understand what was required.  It was a cost benefit analysis gone horribly bad.  People lose their jobs for mistakes far smaller.  And AMR is grounding those flights now because they don't have a choice - not because of concern over passenger safety.  If safety were the overriding issue they would have fixed the problem months ago when it was first brought to their attention.  The CEO should not be applauded for grounding all the flights now he should be fired on the spot for putting profits over passenger safety.  I understand he has a family, but so do all those AMR employees that could lose their jobs due to the economic impact of his arrogant and thoughtless leadership.  Unlike those people, the CEO will be well compensated on his way out the door.

As a frequent (platinum) flyer, American has been my choice for flying no matter where I went world wide.  However, their service has become abominable and I often observe that they act as if they are doing me a favor by taking my money to fly their routes - no food, horrible schedules, impatient staff.  This is just one more nail.  The unfortunate problem is the other arilines are WORSE - USAIR, CONTINENTAL, DELTA, NORTHWEST - you often get stranded with no options, booked but not offered a seat, late flights etc.  So the entire industry is gone bad - I really evaluate driving vs flying these days.

As I understand it - The FAA sends out schedules it expects to be kept. It gives the airlines every opportunity to fix and maintain on an ongoing basis. When an airline disregards the FAA then they (the FAA) grounds the planes and do not allow them to fly until the fix occurs. This has happened to me twice over the decades. Once in Puerto Rico, American Eagle had to cancel all of their flights because of maintenance that had to be done that had not been. They were able to resume the next day when they had completed the maintenance. AA has no regard for its customers at all. It has one thing in mind. Earning a profit. and during tough times the way it rewards its stockholders is by cutting corners. Fortunately for us they got caught at it this time.

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