Long-Awaited AA Bankruptcy Plan Decision Expected This Week
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DALLAS (CBS 11 NEWS) - The emotional rollercoaster continued for American Airlines’ employees Monday.
They thought finally, after two years, a judge in New York would clear the airline for takeoff from bankruptcy and into a merger with US Airways.
But after a two-hour hearing, bankruptcy court Judge Sean Lane said he needed more time to consider the issues.
Patrick Hancock with American’s flight attendants’ union says, “Every now and again, you think you’re going to take a leap, and then you don’t and we’re there again.”
The judge is still deciding whether to have American’s creditors approve the recent settlement between the airlines’ and the Justice Department — or whether he’ll just approve the deal out-right, which the airlines prefer.
There’s another issue: attorneys representing 40 travel agents requested a temporary restraining order to block the merger.
They filed their own lawsuit claiming the merger violates federal antitrust laws and they want it delayed until after their trial.
The judge is considering that request.
Tom Hoban of American’s pilots union remains optimistic.
“It’s been a tough two years for everybody, and there’ve been lots of twists and turns in the process, but ultimately, all’s well that ends well.”
Mark Drusch, a former executive with Continental and Delta Airlines, is confident American will win this week.
“Absolutely. All the major issues have been resolved. Labor issues. Creditor issues. I think this is a minor issue that will be resolved.”
Hoban says his colleagues are ready to take the next route.
“Now, we get on the with rebuilding American Airlines, and what we want to do is build a first class company that can compete with United and Delta and provide our passengers with service they deserve.”
The airlines are hoping to close their $14 billion dollar deal by mid-December.
When that happens, US Airways CEO Doug Parker will become CEO of the new American.
Current American Airlines CEO Tom Horton will become chairman of the board for about one year, before Parker takes over that role as well.
Hancock says, “You are creating the world’s largest airline and operationally, there are tens of thousands of pieces coming together. We’ve got some of the smartest people in the industry working for us.”
While the new American will be one company, both American and US Airways will, for now, continue to operate as two different airlines.
While the airlines plan to officially launch the new American January 7, they say it will take up to two years to completely merge into one.
Drusch says, “I think their frequent flyer program is going to take a year to year and a half because they want to do it right. Again, they don’t want to mess up in terms of losing the good will of the American Airlines Advantage members number one. Number two, they want to make sure that the back office doesn’t screw up.”
Early next year, the new American will start to move U-S Airways airport gates and ticket counters to American Airlines facilities – and vice versa where possible.
No word yet when that will happen at DFW International Airport.
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