A Message from Gerard Arpey
By now you know that today the company filed for protection under Chapter 11 of the U.S. Bankruptcy Code. After much thought and deliberation, the AMR Board of Directors concluded that this was the best step to secure the company's future – and indeed, I have no doubt that with restructured costs and more degrees of freedom to run the business, American Airlines will emerge from bankruptcy protection as a more efficient, more competitive, and stronger company.
Restructuring through bankruptcy will no doubt be a challenging process, and it's no secret that we have tried exceptionally hard over the last decade to avoid this outcome. But the process also represents an opportunity to rebuild AA in a way that assures it will not just survive, but thrive and win in the global marketplace.
I respect the decision of the Board of Directors to take this path, and I am grateful for their request that I continue serving as your Chairman and Chief Executive. However, after careful consideration, I concluded that my remaining in those roles would not be best for the company. In my view, executing the Board's plan will require not only a reevaluation of every aspect of our business, but also the leadership of a new Chairman and CEO who will bring restructuring experience and a different perspective to the process. That is why I informed the Board of my decision to retire from the company.
Those who know me well will understand that idleness is not in my nature, and so it is my intention to accept one of the offers that have come my way over the years. I have decided to join the Emerald Creek Group, an investment firm.
With my full support, the Board has appointed Tom Horton Chairman and CEO. Although Tom has spent over 20 years with American, the time he has spent outside the company has given him a unique perspective to draw upon as he leads the company through this phase and beyond. I am confident that he will lead American Airlines to a successful future.
I want to emphasize what an honor it has been for me to help lead this great company. American Airlines has been my home for three decades, and while the last decade in particular has been enormously challenging for all of us, it has nonetheless been a pleasure and a privilege to work shoulder to shoulder with all of you. Together we have made incredible progress, despite long odds and enormous adversity.
I confess that my heart is heavy today. But any sadness I feel in leaving the company I love is outweighed by my gratitude for the thirty enormously challenging and exciting years American Airlines has given me – and even more so, for the friendship and camaraderie of the best team in the airline business. The men and women of American Airlines have met challenge after challenge with perseverance, skill, determination and grace, and I know you will continue to do so for many years to come.
I wish you all my very best. May God bless you and keep you, and may He guide you to the success you so deeply deserve.
Tuesday, November 29, 2011
A Message from Chairman and CEO Tom Horton
We believe that taking decisive action today will allow American Airlines and American Eagle to restructure so that we can emerge from Chapter 11 well-positioned to assure the company's long term viability and its ability to compete effectively in the marketplace. It is the right decision – and the right time – for our company and its future.
I realize this news might be difficult to absorb; change is never easy. We will do our very best to keep you informed, understanding that there will be many questions we are not able to answer right away. I can certainly tell you that we expect to continue to provide employee wages, healthcare coverage, vacation, and other benefits, without interruption.
As each of us begins to process this news, we must look beyond the moment to consider the powerful assets of our company and the exceptional strengths we have as we enter into this process: one of the most recognized brands in any industry, our unmatched AAdvantage program, our global network and alliances, the innovation and dedication of our employees, and the loyalty of our customers. We will also have the youngest fleet in the industry, giving us more flexibility and the opportunity to build and grow our network down the road. Together, these form our foundation for greater future opportunity. And now we have the potential to overcome our last hurdle by achieving a competitive cost structure, returning to both financial health and a position of industry leadership.
As we work to achieve our goals, our customers' safety, comfort, and travel experience must remain, as always, our top priority. Their satisfaction ultimately determines whether we succeed and are able to shape a successful future for our company.
The people of American have worked tirelessly and honorably to overcome the challenges we've confronted over the past decade, and we made incredible progress against all the odds. Yet, in spite of all our progress, other factors evolved around us to make our road ahead that much tougher. The impact of our significant cost disadvantage compared to our now-larger competitors, all of which restructured their costs and debt through Chapter 11, has intensified in recent weeks due to global economic uncertainty, volatile and rising fuel prices, and ever greater competitive challenges. In spite of the uphill battle we've fought, we nevertheless put in place a powerful foundation: we strengthened our network and forged premier global partnerships; invested in our customers' experience, and announced a transformational fleet renewal plan that is the envy of our industry. We confronted our challenges head on, but in the end, we are now faced with the accelerating impact of factors outside our control and a widening cost gap we have not been able to close – a situation that had to change, one way or another. Our Board decided that it was necessary to take this step now to restore our profitability, operating flexibility, and financial strength, before we missed the opportunity.
As I mentioned, achieving a competitive cost structure remains a final challenge that we must overcome. We have one opportunity to do this right, and that requires a comprehensive overhaul of our costs. We can get it done together, recognizing that we are in this together.
One person who has always put our company's interests first is Gerard Arpey. Gerard led American out of its darkest time and fought with all his considerable energy and intelligence to avoid the path we are taking today. In spite of all the headwinds, Gerard had the vision and fortitude to continue laying the foundation for success, the building blocks for our future – and I was proud to be by his side. And in his last decision as CEO, too, his overriding concern was the best interests of the company and his belief that new leadership was the best choice for our path forward. I have rarely encountered a more honorable or principled person and it has been a privilege to work for him and learn from him for the past 26 years. I will personally miss Gerard's daily presence, but I know we can all continue to count on his friendship and encouragement.
American Airlines has a proud history and we will have a successful future. We intend to reinforce our reputation as a global leader known for excellence and innovation, a travel partner customers seek out, and a carrier that serves communities throughout the world.
The coming months will not be easy, but this company has overcome challenges – many in just the past decade – that would have defeated lesser teams. I am confident that your courage, determination, and ingenuity will assure that our company reaffirms its position among the world's premier airlines.