American Airlines Files For Ch. 11 Protection - KATV - Breaking News, Weather and Razorback Sports

American Airlines Files For Ch. 11 Protection

Posted: Updated:

FORT WORTH, Texas (AP) -- American Airlines' parent company is seeking Chapter 11 bankruptcy protection as it seeks to unload massive debt built up by years of accelerating jet fuel prices and labor struggles.

The nation's third largest airline also said its CEO Gerard Arpey will step down. He's being replaced by Thomas Horton, currently the company's president.

Fort Worth, Texas-based AMR Corp., along with its regional affiliate AMR Eagle Holding Corp. said Tuesday that they filed voluntary petitions to reorganize.

American says it sought protection to reduce its costs and debt to remain competitive.

The airline says it will continue normal flight operations during the reorganization.

American was the only major U.S. airline that didn't file for bankruptcy protection after the 2001 terrorist attacks. The last major airline to file for bankruptcy protection was Delta in 2005.

American says labor-contract rules force it to spend at least $600 million more than other airlines.

Besides higher labor costs, American also struggled with rising jet fuel costs. Jet fuel cost an average of $3 per gallon so far this year - a record according to government data that goes back to 1990. Jet fuel is more expensive now than the average of $2.96 per gallon in 2008, when oil rose above $147 per barrel for the first time. It's risen 56.4 percent in the past five years. The average price of jet fuel was $1.92 per gallon in 2006.

American lost $162 million in the third quarter and has lost money in 14 of the last 16 quarters.

  • Most Popular StoriesMost Popular StoriesMore>>

  • Homeless man charged with murder, local shelter reacts.

    Homeless man charged with murder, local shelter reacts.

    Wednesday, April 23 2014 9:53 PM EDT2014-04-24 01:53:52 GMT
    Little Rock (KATV)---The homeless man who is being charged with first degree murder is being held on a $1 million bond. Little Rock police say 45 year old Leslie Webb got the attention of officers at La Harpe Boulevard and State Street Tuesday night. The report stated that Webb told an officer he was staying near 1400 North Street. Webb then told officers that a man woke him up by shining a light in this face, and then started hitting Webb with it. Police say that officers saw a noticeable am...More >>
    Little Rock (KATV)---The homeless man who is being charged with first degree murder is being held on a $1 million bond. Little Rock police say 45 year old Leslie Webb got the attention of officers at La Harpe Boulevard and State Street Tuesday night. The report stated that Webb told an officer he was staying near 1400 North Street. Webb then told officers that a man woke him up by shining a light in this face, and then started hitting Webb with it. Police say that officers saw a noticeable am...More >>
  • Little Rock man arrested for breaking in sister's home and stealing thousands in items

    Little Rock man arrested for breaking in sister's home and stealing thousands in items

    Wednesday, April 23 2014 6:43 PM EDT2014-04-23 22:43:25 GMT
    LITTLE ROCK (KATV) --A Little Rock man remains in jail after police say he broke in and stole thousands of dollars worth of items from his own sister. Christiney Harvey told police after returning home from being in the hospital for several days she noticed the front window to her home shattered, and the door open. Little Rock police tell us they have arrested Harvey’s brother, 25-year-old Gregory Fisher, for breaking into her home on Potter Street. According to the police report bank cards,...More >>
    LITTLE ROCK (KATV) --A Little Rock man remains in jail after police say he broke in and stole thousands of dollars worth of items from his own sister. Christiney Harvey told police after returning home from being in the hospital for several days she noticed the front window to her home shattered, and the door open. Little Rock police tell us they have arrested Harvey’s brother, 25-year-old Gregory Fisher, for breaking into her home on Potter Street. According to the police report bank cards,...More >>
  • A slight risk for severe weather today

    A slight risk for severe weather today

    Thursday, April 24 2014 1:04 PM EDT2014-04-24 17:04:29 GMT
    A cold air mass will remain over Arkansas this Christmas holiday. With sunshine on this Christmas Eve we'll see highs only in the upper 30s to mid 40's over the state.More >>
    Warm conditions will dominate the upcoming weekend and beyondMore >>