Posted Friday, Sep. 30, 2011
By Andrea Ahles
For the second month in a row, more than 100 pilots have retired from American Airlines, which could cause problems for the fall schedule.
The Allied Pilots Association said 129 pilots will retire effective today. Last month, 111 pilots, many of whom flew Boeing 777s on international routes for American, also retired.
The Fort Worth-based carrier said it will still be able to operate its schedule “with minimal customer inconvenience.” However, American anticipates near-term staffing shortages.
“In preparation for a higher than usual number of retirements, we’ve taken a number of steps to minimize any customer inconvenience,” American spokeswoman Susan Gordon said. “We have made a proposal to the APA that would mitigate near-term staffing shortages that is good for both the airline and our pilots. Recent schedule reductions also have allowed us to absorb a higher retirement number than our historic rate for our current schedule.”
American has already cut capacity in the fourth quarter partly because of the high number of pilot retirements. Usually about a dozen pilots retire from the carrier each month.
The APA told its members in a hotline message Friday that it is evaluating management’s proposal but did not provide details.
The higher rate of retirements is partly due to pilots’ concerns about the financial health of American Airlines and the declining stock market, said Capt. Sam Mayer, a spokesman for APA.
In addition to their pensions, American pilots have a defined contribution retirement plan, Plan B. It lets pilots lock in the value of the fund 60 days before their effective retirement date. So pilots who retire today can get funds based on stock market values on Aug. 1. The Dow Jones industrial average has dropped 8 percent in the past two months.
“Our pilot pensions are tied to the stock market, and the recent performance of the market has led several people to retire,” Mayer said.
“You’ve got a segment there that is concerned about the economic uncertainty in the industry and in particular to American Airlines.”
Shares of American’s parent, AMR Corp., (ticker: AMR) closed at $2.96 Friday, down 5.7 percent.
It takes six to eight weeks to train a pilot on a new aircraft, and American has been recalling 30 to 40 pilots a month. Last year, the carrier announced that it was recalling 250 pilots as it added international routes as part of its agreement with British Airways and Iberia.
More pilots will have to retire starting in December 2012 because of federal requirements that increased the mandatory retirement age for pilots from 60 to 65 in 2007.
The first group of pilots forced to retire under the new requirement will hit 65 at the end of next year.
Read more: http://www.star-telegram.com/2011/09/30/3410490/additional-129-american-airlines.html#ixzz1Zi55gFJe