NYTimes.com Article: American Pilots Offer Airline Deal

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American Pilots Offer Airline Deal

March 30, 2003
By REUTERS






Filed at 4:46 a.m. ET

NEW YORK (Reuters) - The pilots' union at American Airlines
on Sunday said it presented the cash-starved carrier with a
concession deal worth $660 million a year, which will
achieve the cost-savings management required.

Analysts believe time is of the essence for AMR, American's
parent, because of the decline in air travel since the Iraq
war began. The world's largest carrier might file for
bankruptcy as soon as next week, according to banking
sources.

The proposal from the pilots' union follows tentative
accords or concessions offered by other unions. The
26,000-strong union of flight attendants on Friday offered
$340 million of concessions that the union said would meet
management's cost-savings targets.

A pact still must be reached with 16,200 mechanics
represented by the Transport Workers Union, though that
union on Saturday said it had reached tentative deals for
five of its eight working groups, who represent about 2,260
workers.

AMR has said it needs to cut structural costs by about $4
billion a year to avoid bankruptcy. It wants its major
unions to accept $1.8 billion in annual wage concessions.

Yet one TWU union official has warned his members that the
carrier might need another $500 million in cuts if it files
for bankruptcy.

``One consideration driving our discussions is the simple
fact confirmed in our (talks) with company officials that
American's potential debtor-in-possession finances will
demand at least half a billion more in employee concessions
if the company files for bankruptcy,'' Jim Little, director
of the TWU's Air Transport Division, wrote on the union's
web site.

``It was also made clear that without such loans the
company could not operate,'' he added.

The 13,500 pilots union, in a statement, said the
concessions it had offered primarily were work rule changes
and across-the-board pay rate cuts.

The Allied Pilots Association said it had analyzed a
tentative deal reached earlier this week by United Airlines
with its pilots.

``We are confident that the savings we are offering will
enable American Airlines to compete both in the short- and
long-term with a newly restructured United and US Airways,
as well as with low-cost carriers in our industry.''

http://www.nytimes.com/reuters/business/business-transport-american.html?ex=1050035405&ei=1&en=9dfadb4669401316



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