Air Transport World

U.S. majors. (airline industry report)

American: The airline's stunning 1983 financial turnaround presaged its massive order for McDonnell Douglas ND-80s in early 1984. American rebounded from an $18.2-million operating loss in 1982 to reap a $249.5-million operating profit last year. Yield increased from 11.04 cents in 1982 to 11.39 cents.

A major breakthrough in wage negotiations was achieved when American last year finalized agreements with pilots, flight attendants and mechanics for contracts that set much lower wage rates for newly hired employes. Airline fourth quarter profit of $115.6 million occurred when effects of the new agreements began to be felt.

American, already an operator of 20 MD-80s acquired on special leases from McDonnell Douglas, last year ordered an additional 13 for delivery this year. Then, in early 1984, it announced an order for 67 more Md-80s and options for up to 100 additional. Deliveries of the firm-order aircraft extend into 1987, while options extend to 1991 delivery dates. Last year the airline also agreed to buy Pan Am DC-10s.

Three major goals were announced for 1984, including a major expansion in the transcon market, a major expansion of the Chicago O'Hare hub and continued expansion of the Dallas/Ft. Worth hub. Also, the airline said it will continue to improve and expand its Sabre computer reservations system, now used at more than 8,000 travel agent locations.

In addition to the MD-80s, American has 22 more Boeing 767-200s on order.

Passenger boardings in 1983 were up 13.8% to 31.4 million, while RPKs rose 10% to 54.7 billion. Load factor for the year was 65%. Continental: Claiming that it was about to fail financially, Continental on Sept. 24 filed for reorganization under Chapter 11 bankruptcy laws. The airline used the opportunity to cancel its union contracts, precipitating a prolonged labor dispute. Nonetheless, afte two days on the ground, it returned to service with a limited schedule using returning union workers and newly hired non-union employes. …

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