Air Transport World

American Airlines.(US Majors)

The massive labor cost reductions achieved by AA at the end of April 2003 paid huge dividends during the second half of last year and into 2004 as the airline put together three consecutive quarters of operating profitability--excluding special gains and charges--beginning with the 2003 third quarter.

Although bottom-line profitability remains elusive, parent AMR Corp. has reduced the flow of red ink considerably compared to 2002. For the year ended Dec. 31, it lost $1.23 billion, a 65% improvement compared to the $3.5 billion loss recorded for 2002. Operating loss fell to $844 million from $3.3 billion.

American also was the only Big Six carrier to achieve an operating profit in the difficult 2004 first quarter, earning $42 million against an operating deficit of $844 million in 2003 excluding one-time items (ATW 6/04, p. …

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