By Maria Recio
mrecio@mcclatchydc.com
NEW YORK — AMR Corp.’s annual meeting, designed to showcase American Airlines’ growing New York City presence, was a largely uneventful and sparsely attended event on the east side of Manhattan.
AMR Chairman Gerard Arpey credited workers for the carrier’s improved performance, but warned the airline had to be able to overcome $600 million in labor cost disparity compared to its competitors.
American recently reached tentative agreements with the Transport Workers Union and faces tough negotiations with the flight attendants, and later this year, with the pilots’ union. The flight attendants voted Wednesday in favor of a strike, in the event it is allowed to do so by federal regulations.
In a federal securities filing Wednesday, AMR said its focus on five markets - New York, Los Angeles, Chicago, Dallas/Fort Worth, and Miami – and business alliances with foreign carriers “will result in incremental revenues and cost savings of over $500 million per year.” The major savings will be felt in 2011, it said.
The carrier also said the labor cost gap will likely “narrow as open industry labor contracts are settled.”
In one of the few discordant notes at the meeting, Arpey was challenged by a member of the Professional Flight Attendants Association, which represents American’s flight attendants, on increased medical costs cutting into workers’ pay.
“We’ve got to stop this destruction of the middle class,” said Patrick Hancock, a Dallas//Fort Worth-based flight attendant.
Arpey responded that other carriers had abrogated labor contracts through bankruptcies that left American with the $600 million disparity. American stayed out of bankruptcy in 2003 after workers accepted deep cuts.
“A company that’s not competitive I don’t think is going to be successful,” Arpey said.
Several TWU members who attended the meeting suggested that the tentative agreements might not be ratified.
“I’m telling my people vote ‘no,’ “ said Chuck Schalk, a New York local official. But the TWU assistant director, Robert Gless, said the agreement “is a major enhancement to what we’ve been seeing.”
The Allied Pilots Association released a statement citing the “leadership vacuum” at the carrier.
Robert Gless is out of touch with mechanic's requirements for a contract. Tell TWU to stick it and take their company feed bag someplace else.