Hopeful
Veteran
- Dec 21, 2002
- 5,998
- 347
Posted on Thu, Jun. 26, 2003
Airline to decide overhaul base''s fate by end of summer, Barnes says
By RANDOLPH HEASTER
The Kansas City Star
Kay Barnes
American Airlines Inc. expects to decide the fate of its Kansas City maintenance base and two others by the end of summer, Mayor Kay Barnes said Wednesday.
Barnes led a group of city officials who met with an American senior management team Tuesday at its corporate headquarters in Fort Worth, Texas. The trip was part of an ongoing effort to persuade the beleaguered airline to keep its existing maintenance operations in Kansas City.
Nothing was resolved, but that wasn''t the purpose of the trip, Barnes said.
"The meeting went well," Barnes said. "It was a chance to learn more details about American''s current financial situation and how it might affect the maintenance facilities. American has made no decisions and won''t for the next several weeks."
American has about 2,000 employees at its Kansas City overhaul base, which is owned by the city and leased to the airline. American also operates and leases maintenance bases in Fort Worth and Tulsa, Okla., its biggest operation with more than 8,000 employees.
American declined to comment on specific aspects of the meeting.
"We''re meeting with cities all over the country about different ways to improve our efficiencies," said American spokesman Tim Wagner. "We''re appreciative that they are helping us."
Wagner said he was unaware of any timetable that called for American to make final decisions about its maintenance operations in the next several weeks.
"We haven''t really talked about a timeline," he said. "If that was discussed at (Tuesday''s) meeting, I don''t have any information to confirm that."
Barnes said the city plans to submit a proposal to American "as early as next week" that will address how Kansas City''s facility may be upgraded.
"Our strength is our work force," Barnes said. "They''re the best. Our location is also an asset. Our weakness is the physical age of our facility. We are preparing a proposal that will make suggestions to them related to that."
Barnes did not provide further details.
In 2001, when American acquired Trans World Airlines, the airline had plans to install a new engine shop and had hopes of working with the city to modernize the base. That expansion was derailed after the Sept. 11, 2001, terrorist attacks, and the continued sluggish economy forced American and most other major carriers to downsize their operations.
Butch Sponaugle, president of Transport Workers Union Local 530 in Kansas City, said how to pay for an upgrade of the Kansas City facility will be an important part of the discussions between the city and American.
"That''s the main issue -- how to pay for the badly needed work on the overhaul base," he said.
The city of Kansas City has revenue bond capacity available for upgrading the maintenance base. When voters approved a $395 million bond package for airport improvements in 2000, the Aviation Department earmarked $110 million of it for the overhaul base.
The question now is whether American, in its current financial condition, would agree to or would be able to back those bonds and pay them off if issued for work on the overhaul base.
Regarding Tuesday''s discussion, Sponaugle said American executives expressed optimism.
"They said the meeting went quite well," he said. "So the feeling is very upbeat right now."
Kansas City officials aren''t the only ones talking to American about maintenance operations. Four of Oklahoma''s top leaders met with airline officials Monday to discuss American''s Tulsa facility. Those attending that meeting included Oklahoma Gov. Brad Henry and University of Oklahoma president David Boren, a member of the airline''s board.
In April, American''s employees voted to accept $1.8 billion in annual cutbacks in an effort to avoid bankruptcy.
At the time, company executives said a rejection of the concessions most likely would lead to a shutdown of its maintenance facilities in Kansas City and Fort Worth. However, then-chief executive Don Carty said he could give no guarantees to the company''s work force about future downsizings, even if the concessions were accepted.
The airline reported Wednesday that it had positive cash flow from operations during May, and that it expected the same in June. American shares closed the day at $9.08, down 31 cents.
--------------------------------------------------------------------------------
To reach Randolph Heaster, call (816) 234-4746 or send e-mail to [email protected].
Airline to decide overhaul base''s fate by end of summer, Barnes says
By RANDOLPH HEASTER
The Kansas City Star
Kay Barnes
American Airlines Inc. expects to decide the fate of its Kansas City maintenance base and two others by the end of summer, Mayor Kay Barnes said Wednesday.
Barnes led a group of city officials who met with an American senior management team Tuesday at its corporate headquarters in Fort Worth, Texas. The trip was part of an ongoing effort to persuade the beleaguered airline to keep its existing maintenance operations in Kansas City.
Nothing was resolved, but that wasn''t the purpose of the trip, Barnes said.
"The meeting went well," Barnes said. "It was a chance to learn more details about American''s current financial situation and how it might affect the maintenance facilities. American has made no decisions and won''t for the next several weeks."
American has about 2,000 employees at its Kansas City overhaul base, which is owned by the city and leased to the airline. American also operates and leases maintenance bases in Fort Worth and Tulsa, Okla., its biggest operation with more than 8,000 employees.
American declined to comment on specific aspects of the meeting.
"We''re meeting with cities all over the country about different ways to improve our efficiencies," said American spokesman Tim Wagner. "We''re appreciative that they are helping us."
Wagner said he was unaware of any timetable that called for American to make final decisions about its maintenance operations in the next several weeks.
"We haven''t really talked about a timeline," he said. "If that was discussed at (Tuesday''s) meeting, I don''t have any information to confirm that."
Barnes said the city plans to submit a proposal to American "as early as next week" that will address how Kansas City''s facility may be upgraded.
"Our strength is our work force," Barnes said. "They''re the best. Our location is also an asset. Our weakness is the physical age of our facility. We are preparing a proposal that will make suggestions to them related to that."
Barnes did not provide further details.
In 2001, when American acquired Trans World Airlines, the airline had plans to install a new engine shop and had hopes of working with the city to modernize the base. That expansion was derailed after the Sept. 11, 2001, terrorist attacks, and the continued sluggish economy forced American and most other major carriers to downsize their operations.
Butch Sponaugle, president of Transport Workers Union Local 530 in Kansas City, said how to pay for an upgrade of the Kansas City facility will be an important part of the discussions between the city and American.
"That''s the main issue -- how to pay for the badly needed work on the overhaul base," he said.
The city of Kansas City has revenue bond capacity available for upgrading the maintenance base. When voters approved a $395 million bond package for airport improvements in 2000, the Aviation Department earmarked $110 million of it for the overhaul base.
The question now is whether American, in its current financial condition, would agree to or would be able to back those bonds and pay them off if issued for work on the overhaul base.
Regarding Tuesday''s discussion, Sponaugle said American executives expressed optimism.
"They said the meeting went quite well," he said. "So the feeling is very upbeat right now."
Kansas City officials aren''t the only ones talking to American about maintenance operations. Four of Oklahoma''s top leaders met with airline officials Monday to discuss American''s Tulsa facility. Those attending that meeting included Oklahoma Gov. Brad Henry and University of Oklahoma president David Boren, a member of the airline''s board.
In April, American''s employees voted to accept $1.8 billion in annual cutbacks in an effort to avoid bankruptcy.
At the time, company executives said a rejection of the concessions most likely would lead to a shutdown of its maintenance facilities in Kansas City and Fort Worth. However, then-chief executive Don Carty said he could give no guarantees to the company''s work force about future downsizings, even if the concessions were accepted.
The airline reported Wednesday that it had positive cash flow from operations during May, and that it expected the same in June. American shares closed the day at $9.08, down 31 cents.
--------------------------------------------------------------------------------
To reach Randolph Heaster, call (816) 234-4746 or send e-mail to [email protected].
17 AM Hopeful wrote:
42 PM FWAAA wrote:
52 PM FWAAA wrote:
