Tuesday, September 18, 2001

American to announce layoffs this week
By DAVID KOENIG
Associated Press

DALLAS — American Airlines will announce layoffs this week following the terrorist attacks that grounded the U.S. airline industry for two days and left many passengers frightened of air travel.

An American official said Monday that the number of layoffs has not been determined and will depend partly on how much help the airline industry gets from the federal government.

“It may be midweek before we say what the layoffs will be,” said the official, who spoke on condition of anonymity. “We’re still crunching the numbers, and we’re looking at whether we have to take these measures depending on what the government does.”

American said last week that it would cut 20 percent of its schedule. Houston-based Continental Airlines announced Saturday that it would furlough 12,000 of its 56,000 employees, and cut flights by 20 percent.

The American official said it was not clear whether pending layoffs at the Fort Worth-based carrier, first reported by The Dallas Morning News, would match the reduction in flights.

On Sunday, American’s vice president of flight, Robert Kudwa, recorded a hot line message for pilots warning that the Fort Worth-based carrier might also have to make cuts. Kudwa said the number of layoffs would depend on how quickly American could rebuild its flight schedule.

American officials expected to operate 70 percent of the flights that they operated before last week’s attacks in New York and near Washington involving hijacked commercial airliners, including two American jets.

Two of American’s sister airlines appeared to be slightly faster in restoring flights.

Commuter affiliate American Eagle planned to reach 80 percent of normal on Sunday, and Trans World Airlines planned to hit 90 percent. All three carriers are owned by Fort Worth-based AMR Corp.

Analysts say the airline industry was already on a pace to lose more than $2 billion this year, but that depressed travel and extra security costs could push the losses above $5 billion.

Executives of the major carriers are expected to lobby the federal government this week for a government bailout of $10 billion to $20 billion including grants, low-interest loans, tax relief and assumption of insurance liability from claims stemming from the terrorist attacks.

In Austin, Gov. Rick Perry said he was worried that the airlines’ troubles would affect the Texas economy.

“I certainly hope that the Congress, the president can support a package to support the airline industry,” Perry said. “It’s not just about ... the airline industry — it’s also the suppliers, defense companies and a lot of other allied industries that will be impacted in a negative way.”

Transportation Secretary Norman Mineta named AMR vice chairman Robert W. Baker to a task force on safety measures for aircraft that was expected to meet this week.

American’s chief executive, Donald J. Carty, might also travel to Washington to meet policy makers, the American official said.

Atlanta-based Delta Air Lines also may announce layoffs if the government doesn’t help the airlines, chief executive Leo Mullin said Sunday. Delta has joined American, Continental, United, Northwest and US Airways in announcing a 20 percent cut in flights.

Dallas-based Southwest Airlines, however, said it intended to fly 2,700 flights Monday with only six cancellations.

“This is pretty much what we did last Monday,” the day before the attacks, said spokesman Ed Stewart. He said there is no talk of layoffs at the low-fare carrier.