American Air Says Performance Is Improving

By SUSAN CAREY 

The Wall Street Journal

AMR Corp.'s American Airlines, beset by a spike in flight delays and cancellations in September, said in an internal memo Thursday that it is seeing encouraging improvement in its performance metrics so far in October, but "we are not yet back to the levels our customers deserve and expect."

An increase in pilot sick calls and maintenance write-ups in the second half of September, along with emergency inspections of some aircraft after seats came loose in three planes when they were aloft, contributed to the poor showing. FlightStats.com, a flight-tracking service, said American's flights arrived on time only 59% of the time in September, compared with percentages in the 80s for most of its rivals.

During September, American canceled 1,391 flights outright, nearly the equivalent of a full day's schedule of nearly 1,800 flights, a much higher proportion than its peers, FlightStats said.

American said in the memo Thursday that it has seen a 16% increase in its punctuality in the first nine days of October, and it has reduced its cancellations by 27%.

FlightStats.com data indicate that American is turning the corner. On Tuesday, for instance, 66% of its flights arrived on time, defined as within 14 minutes of schedule. That compared with 81% for the entire U.S. industry. And American canceled 18 flights, or 1% of the total. On Wednesday, FlightStats said, 64.5% of American's flights arrived punctually, compared with 79% for the industry, and 11 flights were canceled, or 0.6% of the schedule.

American spokesman Bruce Hicks said the company and its Allied Pilots Association union have resumed negotiations aimed at reaching a new labor contract. A majority of the 10,000 pilots rejected a proposed pact in August, and in September the bankruptcy judge overseeing AMR's restructuring granted the airline's motion to jettison the pilots' old contract and impose concessionary terms on the group. At that point, American said, an abnormal number of pilots called in sick and there was a marked increase in minor maintenance write-ups by the aviators.

In response, American said it was cutting its schedule by 1% to 2% through October and threatened to seek a judicial injunction to stop the disruptions. On Thursday, it said it would extend the capacity reduction to mid-November to help ensure that its operations resume a more normal pattern. The cuts won't affect holiday travel, it said. The company is also offering overtime and additional hours to its airport and reservations employees to better accommodate customer needs, and it's trying to move customers to other flights earlier if there is going to be a delay or cancellation.

The Allied Pilots Association has insisted that it isn't encouraging or condoning a job action. Now that the union and management are back at the bargaining table, the APA said it is seeking "an industry-standard" contract that would provide midcontract pay increases to reflect the superior terms enjoyed by pilots at Delta Air Lines Inc. DAL -0.61% and an agreement being firmed up to be considered by pilots at United Continental Holdings Inc. UAL -1.29% The union said earlier that it planned to meet with American managers every day this week.

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