American Delays Caribbean Decision

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American Delays Caribbean Decision

American Airlines Puts Off Decision to Divest Its Caribbean Operation,
American Eagle
SAN JUAN, Puerto Rico (AP) -- American Airlines has put off a decision to
divest its Caribbean operation, American Eagle, to cope with a union
contract clause that limits flying, because it found a temporary solution,
an Eagle spokesman said Thursday.


The airline will change coding on flights through St. Louis, Mo., which will
let it comply for at least six months with the contract's demand for a
flight cap, said Kurt Iverson, spokesman for the Fort Worth, Texas-based
airline owned by AMR Corp (NYSE:AAR - news).

Following lower demand for flights after the Sept. 11 attacks on the United
States, American Airlines was forced to give 500 pilots furloughs. A clause
in the pilots union contract demands that, if pilots are put on involuntary
leave, the airline cannot increase the number of miles it flies nor increase
the number of seats.

Because the American Eagle, the largest airline service in the Caribbean,
has increased routes and flights, it put the airline in jeopardy of
violating its contract with pilots.

American said Thursday that changing the codes on St. Louis flights by
another American affiliate, American Connection, would allow the airline six
to nine months before it had to decide whether to sell Eagle.

"Most of the changes will have minimal impact on the passengers," Iverson
said.

American Eagle has laid off or given temporary leave to about 1,400
employees since the Sept. 11 terrorist attacks.


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