American Airlines says we'll keep these 85 airplanes, please

[Hatu]

American Airlines told a bankruptcy court Wednesday that it intends to keep 85 airplanes that it leases or owes money on.

The disclosure is part of the Section 1110 process in which American has a certain amount of time to inform the airplanes' owners or lenders that it intends to keep the aircraft or turn them back.

Here are some details on the airplanes:

• The average age is about 12 years, with only two delivered after 2001 (two Boeing 737-800s delivered in 2009).

• The list includes 40 of the Boeing 737-800s, with most delivered in 1999-2001.

• There are three Boeing 767-300ERs, all delivered in 1999.

• The list includes 22 Boeing 777-200ERs, delivered in 1999-2001.

• The company is also keeping 20 Boeing 757-200s, with the majority delivered in 2001.

http://aviationblog.dallasnews.com/archives/2012/01/american-airlines-says-well-ke.html

 

[damajagua]

Does anyone know how many more airplanes are leased or owes money on?

 

[FWAAA]

Nearly every one of AA's 600 active mainline planes is either leased or serves as collateral for debt. So 600 - 85 = 515

 

[damajagua]

That's what I thought. Do you know by when will we know how many airplanes they
are planning to keep.

 

[FWAAA]

There's a 60 day deadline (so 60 days after Nov 29) for AA to make section 1110 elections - so by then, AA will probably have declared which airplanes it will keep and which ones it will reject (leases) or abandon so they can be repo'd (owned planes). That's a general rule - so we may see rejections after that date.

 

[Frank Szabo]

That's what I thought. Do you know by when will we know how many airplanes they
are planning to keep.

We'll have to wait for the filings yet to come to find that out, unfortunately.

It would be nice to know as the Tulsa base's "product", so to speak, is the DC9-80/83 - at this point, nobody knows what the final damages will be when the cutting is done.

CFM isn't going away and CF6 (so far) will still be around for a while. The RB-211 for the 75 hotrod is Rolls' work - we don't have it now and unless a large retooling program is started at TULE, the engines are immaterial - airframe and, perhaps, landing gear (brought in), but no engines.
I doubt if anything relevent re: remaining aircraft will even be leaked until the majority of JT8-2XX motors are run through the shop - that's why the push recently - once everyone finds out what's going to happen, it will tend to ruin many attitudes re: working. Plan on losing your lunch around 1 February - eat lightly.

I expect only enough 80s will remain to fly a severely abbreviated schedual - that will drive layoff numbers, mainly at TULE, and throughout the system.

 

[Super FLUF]

There's a 60 day deadline (so 60 days after Nov 29) for AA to make section 1110 elections

I have heard that AA has filed for an extension for this. This seems reasonable, as sifting through the leases and then re-negotiating terms on hundreds of airplanes seems like a daunting task.

 

[Frank Szabo]

I have heard that AA has filed for an extension for this. This seems reasonable, as sifting through the leases and then re-negotiating terms on hundreds of airplanes seems like a daunting task.

Word was that the leasing companies were going to object to the many of the aircraft being returned, mainly due to the engines being out of time. No idea as to the validity of the rumor but it would make sense that the lessors wouldn't want to have an overhaul on their hands after accepting the engines' return.

 

[FWAAA]

Word was that the leasing companies were going to object to the many of the aircraft being returned, mainly due to the engines being out of time. No idea as to the validity of the rumor but it would make sense that the lessors wouldn't want to have an overhaul on their hands after accepting the engines' return.

There were similar objections made by some of the lessors of the grounded MD-80s and maybe the F100s a few weeks ago, but AA was permitted to reject the leases without performing the maintenance requested by the lessors.

Under Section 1110, I think that extensions of time are possible if the parties agree to the extension, and that may happen. I don't know if the debtors can obtain an extension if the lessor doesn't agree.

 

[BoeingBoy]

It's worth noting that all AA has done on these latest planes is say that it will cure any defaults and gave a schedule for doing so, but according to the filings there are no defaults to cure (pay). A footnote says that the filings does not limit AA's ability to reject any/all of these planes or to renegotiate the terms of the leases/EETC's. In effect, all the filings say is that AA is up to date on lease/EETC payments for these planes.

Jim

 

[tom barry]

Is it a valid speculation that AA will keep EVERY 777 + 737-800 that was ever delivered to AA ?
(I'm thinking foremost of "AGE" ).

 

[BoeingBoy]

AA's last annual statement listed a few 7378's as being in storage, though it doesn't say why. They may not be kept.

Jim

 

[FWAAA]

The 10-K listed one 738 that broke apart at Kingston, Jamaica on 12/22/09 when it landed long with a stiff tailwind:

http://www.dallasnews.com/business/headlines/20100106-Jamaican-investigators-offer-1st-update-on-6007.ece

Shades of Little Rock all over again.

Anyway - the 738 was an owned aircraft not operating as of 12/31/10.

 

[FWAAA]

Is it a valid speculation that AA will keep EVERY 777 + 737-800 that was ever delivered to AA ?
(I'm thinking foremost of "AGE" ).

I expect AA to keep every 738, as the oldest is only 13 years old next month. The 777s are the same age, with the first delivery in early 1999.

That said, I would not be surprised if AA lets go of some of the 777s. Why would it do such a thing? Because of the 777-300s that begin arriving later this year. AA has at least 10 777-323s on the way scheduled for delivery late this year and throughout 2013.

I have previously speculated that these planes are being provided on the cheap by Boeing as compensation for the lengthy delay in the 787-9s that AA ordered nearly four years ago and which won't show up until at least 2014 or later.

AA has already canceled ORD-DEL, a route that requires nearly two full-time 777s, so in two weeks, AA has a couple surplus 777s.

AA has already announced the interior set-up for the 777-323s and said that London would be the first market served by them. No doubt BA is itching to retire its 744s, and AA's 777-323s would do a great job from LAX, SFO and other BA gateways. Here's the interior details:

http://aa.mediaroom.com/index.php?s=43&item=3401

http://www.aa.com/i18n/amrcorp/newsroom/fp_777_300er_interior.jsp?v_locale=en_US&v_mobileUAFlag=AA&v_aadvNum=MTV3852&v_aadvTier=P

If and when the 787s finally arrive, they'll make great replacements for 777-200s plus the 763s. Could be that AA doesn't have all that many 777-200s flying in a few years.

 

[damajagua]

I disagree with part of your post here. I don't see any 777-200 leaving the fleet anytime soon.
There are older wide bodies aircrafts that can be retire first. All the 767-200 and a lot of
the 767-300 looks pretty much worn out.