2012 Archives

AMR wants to emerge from bankruptcy quickly

Excerpt

The following Associated Press story, featuring an SMU alumnus, ran in the March 26, 2012, edition of the Boston Globe.

April 2, 2012

By David Koenig

FORT WORTH, Texas—It took Thomas W. Horton 26 years to reach the corner office, but the promotion came with a catch:

His company was going into bankruptcy protection.

Horton was elevated from president to CEO of American Airlines parent AMR Corp. on a late-night phone call last November. On the same call, the company's board finalized the decision to file for Chapter 11 the next morning. Horton says he got little sleep, knowing that he would have to explain the move to thousands of investors, employees, business partners, and reporters.

The filing wasn't a surprise. American, once the world's biggest airline and known for innovations such as the frequent-flier program, had lost more than $10 billion since 2001. Fuel and labor costs soared, competitors grew bigger and tougher, dropping American to third place in the U.S. airline industry. The company seemed to lack fresh ideas. Investor patience with CEO Gerard Arpey was running out.

The 50-year-old Horton, a devoted runner who trains for marathons, wants to set a fast pace and push American through bankruptcy. He says the company can't afford to move slowly in Chapter 11 unless it wants to be sold to a rival or broken up. He's willing to make unpopular moves -- he wants to cut 13,000 jobs.

Horton sat down recently for an interview with The Associated Press in his sixth-floor corner office. He has a view of Dallas-Fort Worth International Airport on the horizon. One wall is dominated by a photo of aviation pioneer Charles Lindbergh in the cockpit of a Robertson Aircraft plane, one of the companies that formed American Airlines 80 years ago.

Horton discussed managing in the 21st century, dealing with unhappy workers, and his plan to rescue American. Here are excerpts from the interview, which was edited for length:...