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American Airlines Parent AMR Corp. Files for Bankruptcy

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  • #16
    Originally posted by tsv View Post
    I'm a bit confused by your Post but I think I agree. The Employees have had it good (maybe too good) for a long time. So in a sense what happened was inevitable. Hope they saved some $ during the good times.

    Problem is Unions seem to have no concept of good times, bad times - they just want more $ all the time. Dangerous to work for Unionised Organisation because your Union might just push too hard & send the Company broke and cost you your job. Put another way be careful what you wish for.
    exactly which AA employees have had it "maybe too good" for a long time? Do you work for AA or have friends that do? DO you have some inside info to share?

    perhaps you did not understand my post. post 9-11, while all the major us based airlines were in bankruptcy, AA managed to avoid it by convincing its employees to take pay-CUTS. they were promised that their salaries would be brought back with raises. that never happened. meanwhile, the executives gave ZERO back and continued to get their fat checks and bonuses. now, the company is in chapter 11. shareholders and creditors will get fucked, and the executives live on with their platinum executive compensation packages that include "bonuses."

    i never quite understood this bonus concept...in my mind, you get a bonus when you do well, NOT when your company is headed for bankruptcy. maybe i'm just stupid...

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    • #17
      Originally posted by TeeVee View Post
      i never quite understood this bonus concept...in my mind, you get a bonus when you do well, NOT when your company is headed for bankruptcy. maybe i'm just stupid...
      1. The board sets targets for bonuses. If the executive meets the target, then he/she gets the bonus
      2. One can try to do a good job and still be unable to save the company. A board could say "let's give this guy a bonus"
      3. One could argue that the employee expectations for paycuts were unrealistic, and that they needed to accept lower salaries, even if the board allows some executives to make more money.
      4. How much of the bonuses were in stock options?

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      • #18
        Originally posted by Vincentomoh View Post
        1. The board sets targets for bonuses. If the executive meets the target, then he/she gets the bonus
        2. One can try to do a good job and still be unable to save the company. A board could say "let's give this guy a bonus"
        3. One could argue that the employee expectations for paycuts were unrealistic, and that they needed to accept lower salaries, even if the board allows some executives to make more money.
        4. How much of the bonuses were in stock options?
        1. boards are held hostage by execs that think they are worth far more than they are. ignorance prevents these execs from being shitcanned even as they lead their companies down the primrose path to destruction.

        2. Bonus for failing? Bonus for effort? something VERY wrong with that scenario.

        3. What could an employee possibly think wrongly about a paycut that she/he volunteered for to save the company?

        4. to be fair, i'm not sure. but they certainly did not take any executive paycuts. that in and of itself is dead wrong. think about it this way: an exec that makes 3,000,000 per year takes a 500,000 paycut. poor baby! he still makes 250k. some poor ass flight attendant makes 45k and takes a 5k cut. fair? if the exec took the 500k cut 100 flight attendants wouldn't have to take pay cuts etc etc.

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        • #19
          1. How are they being "held hostage"? I know there are cases where executives fool the board (Enron) - But was this the case at AA? How do you know this was the case?
          2. I guess it would be a "bonus for effort" scenario
          3. The company may have said "we'll raise it again" but surely it would have had to include clauses that indicated that it's possible that it may never be raised again, like "but if we find out that our economic performance cannot recover, then..." Also as stated above, the concepts of "good times" and "bad times"
          4. In some companies the pay is entirely in stock options, so if the company fails, the executive's salary goes with it...

          It is true that American companies pay their CEOs more than companies in other countries - but then it would be a prisoner's dilemma as if you pay a CEO too low of a salary, he/she may jump ship and go to another company.

          Originally posted by TeeVee View Post
          1. boards are held hostage by execs that think they are worth far more than they are. ignorance prevents these execs from being shitcanned even as they lead their companies down the primrose path to destruction.

          2. Bonus for failing? Bonus for effort? something VERY wrong with that scenario.

          3. What could an employee possibly think wrongly about a paycut that she/he volunteered for to save the company?

          4. to be fair, i'm not sure. but they certainly did not take any executive paycuts. that in and of itself is dead wrong. think about it this way: an exec that makes 3,000,000 per year takes a 500,000 paycut. poor baby! he still makes 250k. some poor ass flight attendant makes 45k and takes a 5k cut. fair? if the exec took the 500k cut 100 flight attendants wouldn't have to take pay cuts etc etc.

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          • #20
            Originally posted by Peter Kesternich View Post
            I definitely have no love for American, but I still hope they get this turned around and survive.

            Crazy thought here: How about a USAirways/American merger NOW?
            Well there seems to be plenty of discussion about this. eg; http://www.charlotteobserver.com/201...ooking-at.html

            Someone was bound to come along and pick the carcass but the sight of a half starved, mangy old Fox in the Shape of US Airways turning up is probably not doing much to raise the Spirits of the embattled folk at AA and their Administrators.

            Still beggars can't be choosers and both these Companies are beggars so the odds of a Merger or Takeover eventuating must be very high.

            Whether it will turn out to be a marriage made in Heaven or Hell remains to be seen. Personally I'm not planning to buy their stocks.

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            • #21
              Originally posted by tsv View Post
              Personally I'm not planning to buy their stocks.
              Not sure why you would invest in airline stocks to begin with...it's usually a losing bet.

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              • #22
                Originally posted by thxcollins View Post
                Not sure why you would invest in airline stocks to begin with...it's usually a losing bet.
                True, I'll put it another way, if they merge it might be a good play to short their stocks

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