Allied Pilots Association Members Voice Concerns about American Airlines' Antitrust, Joint Venture Applications

Business Wire, Oct 29, 2008

FORT WORTH, Texas -- The Allied Pilots Association (APA), certified collective bargaining agent for the 12,000 pilots of American Airlines (NYSE: AMR), asked its members beginning last week to contact lawmakers on Capitol Hill to echo the union's concerns about American Airlines' joint venture plans and related application for antitrust immunity. In response to the request APA e-mailed to its members, well over half of the airline's active pilots have already responded by sending messages to their U.S. representatives.

American Airlines, British Airways, Iberia, Finnair and Royal Jordanian recently filed an application for worldwide antitrust immunity and have been seeking rapid approval of their application. American Airlines also recently announced it had reached a "joint business agreement" with British Airways and Iberia.

APA has emphasized the need for lawmakers and regulators to conduct a full examination of related national security, competitiveness and outsourcing issues associated with American Airlines' plans.

"The federal government depends upon U.S. airlines to carry troops and supplies in wartime as the nation's Civil Reserve Air Fleet," said APA President Captain Lloyd Hill. "Are we comfortable having foreign-flagged aircraft ferry our troops in wartime?"

Hill questioned whether granting American Airlines the ability to enter into a "virtual merger" with non-U.S. carriers would conflict with Congress' limits on foreign ownership and control. He also emphasized the need to understand how the various nations' different labor laws would be reconciled.

"The unintended negative consequences we are experiencing from the relaxation of financial market regulations serve as a potent reminder of the need to undertake thorough due diligence where complex deals like this are concerned," Hill said.

He also reiterated the union's job security concerns.

"Capacity-sharing arrangements such as what American Airlines is seeking to enter into are actually a form of industry consolidation, potentially resulting in yet more hard-working Americans' jobs being eliminated," Hill said.

In addition, Hill cited contractual limitations on American Airlines' ability to proceed with its plans.

"We have two ongoing arbitration proceedings that directly relate to the feasibility of these deals," Hill said.

Founded in 1963, the Allied Pilots Association--the largest independent pilot union in the U.S.--is headquartered in Fort Worth, Texas. APA represents the 12,000 pilots of American Airlines, including 1,969 pilots on furlough. The furloughs began shortly after the September 11, 2001 attacks. Also, several hundred American Airlines pilots are on full-time military leave of absence serving in the armed forces. The union's Web site address is www.alliedpilots.org. American Airlines is the nation's largest passenger carrier and fifth-largest cargo carrier.