American Airlines to reduce management, support ranks 8%

Jun 27, 2008 (The Dallas Morning News - McClatchy-Tribune Information Services via COMTEX) -- AMR | Quote | Chart | News | PowerRating -- American Airlines Inc. has warned management and support employees that it will eliminate about 8 percent of their jobs after Labor Day.

That reduction would put job cuts for those employees at the upper end of American's announced plans to reduce flying 7 percent to 8 percent by late 2008.

"While the reductions will vary by department, they will generally be in line with the capacity reduction of approximately 8 percent from the 2008 Plan," American senior vice president of human resources Jeff Brundage told employees in a letter.

"Reductions should be completed within the month of September."

American announced May 21 that it was reducing its flying in response to skyrocketing prices for jet fuel.

The bulk of the capacity reductions will hit American's domestic system, where it expects to fly 11 percent to 12 percent less capacity in the fourth quarter than in the same period of 2007.

The latest estimate from American parent AMR Corp. is that American and regional subsidiary American Eagle will spend $10.15 billion on jet fuel in 2008, up more than 50 percent from 2007's fuel bill of $6.67 billion.

On Wednesday, the airline outlined a series of flight cuts at connecting hubs Dallas/Fort Worth International Airport, Chicago and St. Louis and at New York LaGuardia Airport.

Mr. Brundage said each department will be able to explore other means of reducing payroll costs 8 percent without involuntary layoffs, such as volunteer severance packages or extended leaves.

An American spokesman declined to put a number on the number of jobs to be eliminated.

The airline has not spelled out the job cuts planned for frontline people such as airport-based workers, mechanics, pilots and flight attendants.

AMR chairman and chief executive Gerard Arpey told reporters May 21 that the job cuts would be in the thousands, but he offered no harder numbers.

Based on AMR's Dec. 31, 2007, payroll of 85,500 full-time equivalent employees, an 8 percent reduction in headcount would eliminate more than 6,800 jobs at AMR, American and American Eagle.

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