American Airlines to Slow Pace of Rapid Expansion

THE JOURNAL RECORD, September 12, 1991 | Go to article overview

American Airlines to Slow Pace of Rapid Expansion


NEW YORK (AP) _ American Airlines on Wednesday announced a slowdown in the top U.S. carrier's rapid expansion pace, illustrating the industry's financial pain and sending a chill through the world of aircraft manufacturing.

"Profits simply aren't what they need to be," said Robert L. Crandall, chairman of the airline's parent, AMR Corp.

Crandall told securities analysts in New York he was planning cutbacks of $400 million over the next two years and more than $500 million over five years. He did not say where all the cuts will be made, but one big item will be reduced spending on aircraft.

"We're looking at food, advertising _ every single item of controllable expenses," he said.

His announcement came as American and other large airlines have been tightening the rules on fall-season discounts for air travelers, another sign that the biggest carriers aren't happy about selling cheap seats.

Crandall acknowledged fares may need to go up. He lashed out at executives at some competitors "who seem to believe their mission in life is to put every living human being on an airplane _ at any price _ and who have failed to do their economic homework. . ."

"This get-'em-on-the-plane mentality is exacerbated by the fact that more than 25 percent of our industry's capacity is being operated by bankrupt and near-bankrupt carriers," Crandall said. "As we all know, such carriers often price to raise cash, which makes absolutely no sense in a long-term, capital intensive industry like ours."

Crandall also attacked the government, saying lawmakers who require a wheelchair on board each widebody aircraft should be "more realistic about acknowledging their costs" and a proposal to remove seats next to emergency exits will be expensive while having no "measurable impact on passenger safety."

Most analysts saw Crandall's cost-cutting plans as a sensible move as the industry struggles to recover from losses brought on by the Persian Gulf War and the recession.

"The hard times have affected the top of the pack since the invasion of Kuwait last summer, but it's finally affected at least one company's thinking of their overall aircraft order plan," said Mark Daugherty, who follows airlines for Dean Witter Reynolds Inc. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

American Airlines to Slow Pace of Rapid Expansion
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.