Pilots union: AMR may be bankrupt as soon as May DALLAS (AP) =97 AMR, the parent company of American and American Eagle=20 airlines, could be forced into bankruptcy as soon as May, according to the= =20 union representing American Airlines' pilots. An independent analysis of=20 AMR finances by the Allied Pilots Association found that the Fort=20 Worth-based company has just three months' worth of cash reserves. The=20 analysis, reviewed by The Dallas Morning News for a story in Wednesday's=20 editions, concluded that the $1.8 billion in annual employee concessions=20 American has sought might not be enough to save the world's largest=20 airline. "Realize that the $1.8 [billion ] is a minimum figure," a posting= =20 on the union's Web site says. "There is no guarantee that AMR won't ask for= =20 more. AMR states the alternative is bankruptcy." American spokesman Bruce=20 Hicks told the newspaper that the airline will not comment on specifics of= =20 the union's findings, but he said American's talks with its unions were=20 productive. "They understand the sense of urgency that we need," he said.=20 The APA said it reached its findings after receiving full access to AMR's=20 accounting books and discussing the matter thoroughly with AMR chief=20 executive Don Carty and president Gerard Arpey. The union outlined the grim= =20 financial picture in board meetings and discussions over the past few days,= =20 the newspaper reported. The union said it found that although American began the year with $2.7=20 billion in cash, $775 million of that is restricted, meaning it cannot be=20 used to pay bills. That would leave $1.9 billion in ready cash, but=20 American will be forced to refinance some debt this spring. The pilots said= =20 that move will cost $200 million, lowering the balance to $1.7 billion. The= =20 union said it believes that $1 billion is the minimum American needs to=20 keep flying, a figure confirmed by analysts. United Airlines entered=20 bankruptcy Dec. 9 with about $800 million in cash, and most analysts think= =20 it should have filed far sooner, the newspaper reported. AMR chief=20 financial officer Jeff Campbell said in January that American was losing=20 about $5 million a day and would continue to do so during the winter, the=20 weakest part of the travel season. Based on that, the pilots calculate that= =20 American would need to file for bankruptcy May 25. The airline has said its= =20 losses were unsustainable and has warned that bankruptcy is a possibility.= =20 Most analysts had predicted that American might run out of money late this= =20 year or early in 2004. The biggest variable that could alter that timetable is the threatened war= =20 with Iraq. American's woes could worsen if combat begins in the Middle East= =20 and jet fuel prices increase from current levels, which is more than double= =20 the February 2002 level. The union said time is short. The union hopes to take only two months to=20 reach a contract, present it to members and obtain approval, the newspaper= =20 reported. If talks take much longer, the union said, American's chances of= =20 filing for bankruptcy are "100 percent." Union president John Darrah, in=20 answering questions from members, suggested that some of the concessions=20 need to be permanent, the newspaper reported. Instead of getting their=20 concessions back, the pilots' union wants to "invest" in the airline and=20 share in its financial gain, possibly through stock options or other ways=20 that produce a return to the pilots, Darrah said. American's concessions talks with its pilots are a tough sell. American=20 pilots are paid, on average, 25% to 30% less than pilots at industry-leader= =20 Delta, which also has asked its pilots for concessions. American's flight=20 attendants and ground workers have contracts in place that make them among= =20 the best paid in the industry. Contracts for the Association of=20 Professional Flight Attendants and the Transport Workers Union are up for=20 change in 2004. The Transport Workers Union began intensive contract=20 discussions this week. The flight attendants have not but say they will if= =20 the situation becomes urgent. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@escape.ca Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.dbombo.net/muddyangels/ TnT Webdirectory: http://search.co.tt *********************************************************