American nears cost-cut accords with its workers By Dan Reed, USA TODAY GRAPEVINE, Texas =97 American Airlines may be only a week or two away from= =20 landing critical cost-saving deals with its unions, moving the world's=20 largest airline closer to profitably competing against low-cost carriers.=20 CEO Don Carty said Thursday that his company would get the deals "soon" and= =20 confidently predicted that his financially embattled company would remain=20 the industry's largest. "We're not done being big, and we're sure as heck=20 not going to start apologizing for it," Carty told about 700 American=20 employees gathered in a hotel ballroom at Dallas/Fort Worth airport. "Who=20 said being big has to mean being slow?" Carty repeatedly expressed=20 confidence that his company will avoid bankruptcy reorganization, which=20 industry analysts and airline experts increasingly have been predicting is= =20 ahead. One reason, Carty explained after his speech, is the rapidly falling price= =20 of jet fuel since President Bush delivered his 48-hour ultimatum to Saddam= =20 Hussein on Monday night. American's price for fuel peaked two weeks ago at= =20 "$1.14 or $1.15 a gallon. Now, it's down in the 80-cent range," Carty said.= =20 "Historically, 80 cents is still pretty high, but it's a whole lot better=20 than $1.15. That saves us a ton of money." During his speech, Carty sounded= =20 at times more like a Texas preacher revving up his audience than the=20 Canadian-bred, Harvard-educated executive he is. He promised that with the= =20 $1.8 billion a year in labor concessions he expects workers to accept and=20 $2.2 billion a year in other cost cuts, American "will be creating a new=20 (business) model =97 one that allows us to take the fight to the low-cost=20 carriers." The model won't look much different from the current one under=20 which AMR, American's parent, has lost $5.3 billion in two years. American will build on its strengths, Carty said, citing its global service= =20 network, its hubs at Dallas/Fort Worth, Chicago, St. Louis and Miami,=20 service to major and small cities and its reputation for "premier service."= =20 The key: lowering costs while maintaining those service features that Carty= =20 says allow American to produce 30% more revenue for each plane load in=20 markets where it competes directly with low-cost carriers such as Southwest= =20 Airlines and JetBlue Airways. Though American makes many seats available at= =20 the deeply discounted prices offered by low-cost competitors, some=20 travelers, he noted, willingly pay more for American's higher level of=20 service, broad frequent-flier program and global reach. The problem, Carty= =20 says, is that such passengers won't pay enough to cover American's much=20 higher costs. That's why cutting costs is critical, he says. People with=20 knowledge of American's labor talks have suggested that the airline could=20 sign the first of its deals, with the Allied Pilots Association, as soon as= =20 next week. And deals with American's flight attendants and its mechanics=20 and ramp workers likely would come the following week.Asked twice if that's= =20 accurate, Carty would only wink and say "soon." *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@xxxxxxxxx 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.thehummingbirdonline.com TnT Webdirectory: http://search.co.tt *********************************************************