AMR Chairman and CEO Gerard Arpey at the Bank of America-Merrill Lynch Global Transportation Conference
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Today, AMR Chairman and CEO, Gerard Arpey, spoke at the 2010 Bank of America-Merrill Lynch Global Transportation Conference and discussed the company’s position, including its bolstered liquidity, fleet renewal, revenue and cost performance, its network, and how it is deepening its relationships with alliance partners. The remarks reflected Arpey’s optimism regarding the company’s ability to benefit from the industry’s recovery due to a number of moves the company has made to position itself for success.
In addition to bolstering its liquidity by completing approximately 6 billion dollars of financings in 2009, the company continues to move ahead with its fleet renewal program centered around dramatically more fuel-efficient Boeing 737s in the near term and Boeing 787 Dreamliners in the future. Fleet renewal is also taking place at American Eagle with the delivery of new Bombardier CRJ-700s, outfitted with First Class seating, and upgrades to the existing CRJ-700 fleet.
Arpey’s remarks also focused on revenue and the company’s steps to position itself for stronger revenue performance in the future. Recognizing that airline revenue performance rests largely on the strength of its network, Arpey said that American’s 2009 domestic realignment to focus on its cornerstone markets positioned American very strongly in the four largest markets in the United States – New York, Los Angeles, Chicago, and Dallas / Fort Worth as well as maintaining its unmatched position in Miami, an important international gateway. Internationally, Arpey noted that oneworld has hubs in each of the top four premium traffic airports in the world: London Heathrow, JFK, LAX and Hong Kong, in addition to Tokyo, Dallas, Chicago and Miami, which also rank in the top tier of premium airports. In addition, progress is being made to deepen its relationships and work more closely with oneworld partners British Airways and Iberia across the transatlantic and with Japan Airlines across the transpacific. New service between New York’s JFK and Tokyo’s Haneda are expected to begin once the Haneda runway project is completed.
American is also leading the industry toward a new revenue paradigm, which offers more customized product options – enabling American to capture more of the value customers place on those elements, and enabling those customers who don’t value them to avoid paying for them. See today’s announcement of Your ChoiceSM services.
Arpey said that American’s unit costs, excluding fuel and labor, already compare favorably to other big network competitors and shared his view that the labor cost gap between American and other large, network airlines has already begun to narrow. See the prepared remarks, and the slide presentation for more details.