American Executives need to go....

[Frank Szabo]

deleted

 

[FWAAA]

I've not seen that tidbit yet - not trying to call you out, but where was the item/article?

If true, that would add considerable weight to the notion the 2003 debacle and associated give-backs were a manufactured lie allowed to take place by the BOD (in addition to Carty's "falling on the sword" departure) and aided by our so-called "representation". When did he begin his "I have a moral objection to bankruptcy" mantra?

Not leaving with severence pay typically means "quitting" - in this case, 'quitting' being offered as an option by the employer.

We'll have to agree to disagree - it still sounds to me like he was shown the door.

You deleted your other post, but I'm going to respond anyway.

Arpey wasn't actually in sole control in late April, 2003. Brennan (former top management at Sears and long-time AMR board member) was named Chairman the day Carty left on 4/25/03. Arpey was named CEO but served in an apprentice role with Brennan. The board of directors didn't care what Arpey thought of bankruptcy at the time, since the board and Carty issued the "give us concessions or we file Ch 11" threat. I don't recall exactly when Arpey first articulated his moral objection to Ch 11, but IIRC, it wasn't a recent development.

 

[eolesen]

FWAAA is correct that Ed Brennan, as non-executive Chairman, was calling the high level shots from April 2003 to May 2004.

I believe because of Gerard, AMR hadn't filied Ch 11 BK sooner.
He is a very principaled, God fearing man. AMR wanted him to stay, but he thought it best to step down and move on.
I have no doubts tears were shed yesterday. 30 years....

He is principled. One of the guys who worked with me at HDQ knew him very well from church. He's not one to take the spotlight.

Maybe the lack of a principled executives is why so many people here are suspicious about the fact he resigned rather than continue on a path that he fundamentally disagreed with.

I don't doubt for a moment that Bob would have responded the same way in this situation -- Crandall also saw bankruptcy as an utter failure, and still takes any opportunity to bash how the process has been used for strategic purposes rather than as a measure of last resort.

At the risk of this sounding like hero-worship, I personally think Gerard did more to stand up for what was right for the employees than they'll ever know. You guys got eight more years of pensionable credit, and yes, I've heard from a fairly reliable source that he was more or less the one keeping you guys in TUL on AA payroll. Horton and Ream will not be quite so compassionate.

Arpey will be forever vilified by some on the executive compensation issue. I blame the board for that initial mistake, but he has to bear the responsibility for letting the wrong-doing continue. Gerard could have taken a much harder stance on that in 2005, but chose to stand by quietly and let the wrong-doing continue. Sadly, that will always overshadow whatever good was accomplished from 2003 to 2011.

 

[Frank Szabo]

You deleted your other post, but I'm going to respond anyway.

Arpey wasn't actually in sole control in late April, 2003. Brennan (former top management at Sears and long-time AMR board member) was named Chairman the day Carty left on 4/25/03. Arpey was named CEO but served in an apprentice role with Brennan. The board of directors didn't care what Arpey thought of bankruptcy at the time, since the board and Carty issued the "give us concessions or we file Ch 11" threat. I don't recall exactly when Arpey first articulated his moral objection to Ch 11, but IIRC, it wasn't a recent development.

That was why the other post was deleted - after more thought (and a question asked), I recognized my cranial rectosis.

 

[eolesen]

NYT picked up a little more detail:

Throughout his eight-year tenure as the AMR Corporation‘s chief executive, Gerard J. Arpey had consistently emphasized one strategic point: He would not put the airline into bankruptcy.

But by late last week, when it became clear that AMR, the parent of American Airlines, would need to seek Chapter 11 protection, Mr. Arpey decided that he would rather retire, a person briefed on the matter told DealBook.
...
Other legacy airlines, beginning with the UAL Corporation’s United Airlines, had begun filing for bankruptcy protection to help shed costs and make themselves more competitive. But Mr. Arpey emphasized repeatedly that AMR could turn itself around without resorting to Chapter 11, a process that would likely harm employees’ pensions and other benefits.

Yet over recent weeks, AMR found itself in an increasingly difficult position, confronted by economic uncertainty, the potential for higher fuel costs and a credit rating downgrade by Standard & Poor’s two weeks ago. Over that time, AMR’s board gradually came to the conclusion that its financial situation was untenable, and that it needed to consider bankruptcy, people briefed on the matter said.

But the board still wanted Mr. Arpey to remain at the company in some leadership capacity, and on multiple occasions over the last few weeks directors and Mr. Horton asked him to stay, one of these people said.

By late last week, Mr. Arpey decided that he would leave.

“Both the board and Tom Horton throughout this process asked Gerard Arpey to stay on,” Thomas A. Roberts, an outside lawyer for AMR’s board, said. “This was a decision that Gerard made himself because the company was turning in a new direction.”

Despite his long tenure as AMR’s chief executive, however, Mr. Arpey is not expected to leave with a big payout. Under the terms of his contract, he will not receive any severance, according to the research firm Equilar. And with AMR skirting $0.35 a share right now, his stock holdings are essentially worthless.

Full article here: http://dealbook.nytimes.com/2011/11/29/for-amrs-now-former-chief-a-long-career-felled-by-chapter-11/

 

[Hopeful]

NYT picked up a little more detail:



Full article here: http://dealbook.nytimes.com/2011/11/29/for-amrs-now-former-chief-a-long-career-felled-by-chapter-11/

So Arpey resisted BK, the BOD decides after years that BK is the preferred option..Why would they want to keep Arpey who so much did not want to file?

I beleive the BOD urged him to retire...Looks better for all involved.

 

[Flying low]

So Arpey resisted BK, the BOD decides after years that BK is the preferred option..Why would they want to keep Arpey who so much did not want to file?

I beleive the BOD urged him to retire...Looks better for all involved.

That's what I say, Arpy was given a choice -- file or leave.

 

[wrencher]

That's what I say, Arpy was given a choice -- file or leave.

The only way these boys make the big money is to work for 5+years and create their own contract so when they leave they make the big bucks just like Carty did. Arpey was the CFO at the time just like Horton was the CFO running this now bankrupt airline, now they both were promoted to CEO , see a patttern, it's the big master plan against union labor. It's easier to get from the likes of the TWU represented than to actually manage a business.