Open Letter to the Unsecured Creditors of AMR Corporation
You trusted them. You invested your money. You expected a return ON your capital.
They lied to you. They lost your money. You now want a return OF your capital.
Welcome to the party. They have been lying to us and picking our pockets for decades. There is nothing you can tell us about AMR’s corporate managers that we don’t already know, because we have been in a de facto marriage with these people for decades; it is now time for a divorce.
As you know, we (AA’s pilots) did not sign off on the time-honored tradition of letting investors claw back their money out of our dignity and future earnings. Thirteen and one half percent of an unknown quantity, with the possibility of the malignancy responsible for the bankruptcy still at the helm, along with unreasonable concessions in all areas (quality of life, job security, etc.) was not enough to get us to look past where we are. We decided, by a wide margin and against the pressure-cooker tactics by our own union, to go against all conventional wisdom and fight. Our fight is against those that lost our money, destroyed our careers, and sullied the most storied name in commercial aviation; we have no quarrel with you.
We have no quarrel with you so long as you do not seek to enrich yourselves at our expense. We can be your biggest asset in returning a great investment to you, or we can be an insurmountable hurdle to you ever seeing another dime. The choice is exclusively yours.
The pilots of American Airlines (not AMR or OneWorld) want what you want. We want the airline that hired us – the premier name in commercial aviation; the leader in innovation; the most feared competitor; the most reliable airline; and the first choice of the premium passenger. We want to return to what we once were – the New York Yankees of airlines. We want this airline to be the best return on investment for the capital markets. In short, we want to make a lot of money for you, us, and our shareholders, by being the best.
AMR’s corporate managers do not see it that way. They are content, even proud, to offer a product that is “just good enough,” while running from the competition. Accountants do not lead, nor are they visionaries. Their myopic greed has resulted in two of our fleets being grounded for improper maintenance. One wonders what other surprises will float to the surface.
They have not had any plan, other than strip-mining their employees and cheapening their operation for almost two decades. And what has it gotten us? Dirty, broken airplanes and a surly labor force. In a capital intensive, customer service industry that is a death trap – and that’s where your money is.
Everyone knows the only solution is to merge with US Airways. That would put us back on top and offer the premium passenger the most comprehensive network. We know it. You know it. Wall Street knows it. AMR management knows it. The difference is AMR wants it to happen after bankruptcy so they can achieve a windfall payout – a payout for doing nothing more than losing your money, our pension, our shareholders’ equity, and our collective reputations. If they were serious about restructuring and returning your capital, they would come to you with this plan. They have not because they are only serious about enriching themselves, as other airline executives have done.
Let’s be frank in our discussion. You have allowed this because you want to see if you can take us down as an easy source of recapitalization. We saw this in the so-called “Last-Best-Final-Offer” and handily rejected it. That isn’t going to change. We won’t allow our union to attempt such a sell-job again. You are not going to get your money out of the pilots in that fashion. If you want your money back, work with us. Give us the tools to charge forward in the market and rebuild the best airline in the world and we will return your money beyond what you ever expected.
If you can’t use the current management to strip us to the bone, what good are they? Why let them toy with your money? Why allow the very people that lied to you and destroyed your investment the ability to be handsomely rewarded for it?
End this destructive conflict and join with the pilots to rid the industry of this malignancy. Listen to what the US Airways executives have to say and how they want to run an airline. You will be stakeholders in the largest network on earth, with executives that want to make it the best, and employees that can deliver on that vision.
There will be four large airlines left: American, United, Delta, and Southwest. Give us a three-year contract that uses the remaining three airlines as comparators with no erosion in scope-of-flying, no demeaning or petty sick leave clauses, and a stake in the new airline commensurate with our losses, and see what 14,000 highly motivated pilots can do for you.
We didn’t break this airline and we didn’t lose your money. We didn’t incur a $162 million fine for shoddy maintenance (the largest in the history of commercial aviation), and we are not responsible for the coming fine for the substandard maintenance on our 757s. We hired on with the airline that was the gold standard of airline maintenance and dependability. We were once proud of what we called the “ON-TIME MACHINE.“ In 2003, we gave AMR corporate managers everything they wanted and willingly worked with what we perceived as a new management team to forge a restructured American Airlines. All was working smoothly right up to the point where AMR executives rewarded themselves for our sacrifice, taking what little profit was gleaned in a decade of $10 billion in losses. By giving AMR executives what they wanted, they destroyed the airline. They now want you to trust them as we did a decade ago. Please learn from our lesson or be doomed to repeat our mistake. We won’t repeat it.
We know that capital and labor rarely find common ground in modern America. Where it does, the results are inspiring (think Southwest). You can view us as your partner, or you can view us as your adversary. The choice is yours, but you also need to know we are not going to go along with the further destruction of our careers, regardless of what the courts say we must do. That avenue is closed to you.
Sometimes opportunity knocks and sometimes it kicks down the door. This is the latter. We can view each other as our most valuable assets or we can continue this futile exercise of trusting imbeciles to deliver on promises they have no intention of fulfilling. They are only in it for themselves and they should be thrown to the curb by all of us they have betrayed before they do it again.
We are neither your adversary nor your cash reserve. We are your most valuable asset. Forge on with that in mind and let’s become “Something Special in the Air” once again.
American Airlines pilot
New York, NY