Following months of speculation, and parent company AMR Corp. today announced it has filed for Chapter 11 reorganization in the Southern District of New York bankruptcy court.
American becomes the final U.S. major carrier to file for bankruptcy protection, a move the company has sought to avoid for some time. In the first nine months of the year American Airlines recorded a net loss of $884 million—more than double the $373 million deficit posted for the same period last year.
In a statement, the company’s president Tom Horton said: “Our Board decided that it was necessary to take this step now to restore the company’s profitability, operating flexibility, and financial strength. We are committed to working as quickly and efficiently as possible to appropriately restructure American so that it can emerge from Chapter 11 well-positioned to assure the Company’s long term viability and its ability to compete effectively in the marketplace.”
The company also announced the retirement of chief executive, Gerard Arpey, who will be succeeded by Horton as chairman and chief executive, as well as retaining his title of president.