Effects of the AMR Corporation Bankruptcy on Airline Passengers and Emp

On November 29, 2011, American Airlines became the last of the legacy flight paths to go soften when its parent company, AMR Corporation, filed for Chapter 11 reorganization. Sought almost exclusively by tumid corporations, a Chapter 11 unsuccessful person allows a firm to go operating(a) while reorganizing itself to create a more profitable monetary mannequin (Chapter 11 Definition). Essentially, this provides a last resort logical argument scheme if the firm successfully reorganizes, its new financial structure begins strip its debt. If the reorganization fails, the company begins liquidating its assets to repay the stakeholders to whom it owes money (An Overview of Corporate). An evaluation of the AMR bankruptcy on with the bankruptcies of its competitors provides insight to its potential impact on airline passengers, airline employees, and the preservation as a whole. To put the AMR bankruptcy into perspective, it is necessary to figure trade conditions for airlin e companies since 2000. Every major American airline with the ejection of American Airlines filed for Chapter 11 bankruptcy between 2002 and 2005 as a resolvent of repel costs increasing while demand decreased hobby the niche and the September 11 terrorist attacks (Rushe). Between an already struggling economy, heightened aerodrome security, and the hesitancy of many passengers to continue air travel, these airlines filed for bankruptcy to escape debt and generate to yearbook profitability. As of 2011, every major airline had achieved this goal with the ejection of American Airlines, the only of these companies to forgo bankruptcy and, consequently, the only to remain in debt. As American Airlines financial issues became exacerbated by high oil prices, AMR last f... ...clopedia of Economics. Ed. David R. Henderson. second ed. Library of Economics and Liberty, n.d. Web. 29 whitethorn 2012.Stancavage, John. Analysts See US Airways spinal fusion as Americans Next Step. Aviat ion Pros. Ed. Ronald Donner. genus Cygnus line of credit Media, 21 whitethorn 2012. Web. 21 May 2012. .Trejos, Nancy. Union Groups allow American Airlines Final Contract Offer. USA Today. Ed. John Hillkirk. N.p., 15 May 2012. Web. 17 May 2012. .Whitely, Jason. Unions Have Their Say on American Airlines Bankruptcy. WFAA.com. WFAA-TV Inc., 13 May 2012. Web. 21 May 2012. . Effects of the AMR Corporation Bankruptcy on Airline Passengers and EmpOn November 29, 2011, American Airlines became the last of the legacy airlines to go bankrupt when its parent company, AMR Corporation, filed for Chapter 11 reorganization. Sought almost exclusively by large corporations, a Chapter 11 bankruptcy allows a firm to continue operating while reorganizing itself to create a more profitable financial framework (Chapter 11 Definition). Essentially, this provides a last resort business strategy if the firm successfully reorganizes, its new financial structure begins cutting its debt. If the reorganization fails, the company begins liquidating its assets to repay the stakeholders to whom it owes money (An Overview of Corporate). An evaluation of the AMR bankruptcy along with the bankruptcies of its competitors provides insight to its potential impact on airline passengers, airline employees, and the economy as a whole. To put the AMR bankruptcy into perspective, it is necessary to examine market conditions for airline companies since 2000. Every major American airline with the exception of American Airlines filed for Chapter 11 bankruptcy between 2002 and 2005 as a result of labor costs increasing while demand decreased following the recession and the September 11 terrorist attacks (Rushe). Between an already struggling economy, heightened airport security, and the reluctance of many passengers to continue air travel, these airlines filed for bankruptcy to escape debt and return to annual profitability. As of 2011, every major airline had achieved this goal with th e exception of American Airlines, the only of these companies to forgo bankruptcy and, consequently, the only to remain in debt. As American Airlines financial issues became exacerbated by high oil prices, AMR finally f... ...clopedia of Economics. Ed. David R. Henderson. 2nd ed. Library of Economics and Liberty, n.d. Web. 29 May 2012.Stancavage, John. Analysts See US Airways Merger as Americans Next Step. Aviation Pros. Ed. Ronald Donner. Cygnus Business Media, 21 May 2012. Web. 21 May 2012. .Trejos, Nancy. Union Groups Accept American Airlines Final Contract Offer. USA Today. Ed. John Hillkirk. N.p., 15 May 2012. Web. 17 May 2012. .Whitely, Jason. Unions Have Their Say on American Airlines Bankruptcy. WFAA.com. WFAA-TV Inc., 13 May 2012. Web. 21 May 2012. .