Irony Alert: Stock Market Punishes American Airline for NOT Going Bankrupt

Trottman, Melanie. 2007. “AMR’s Long-Term Solution Needs to Gain Some Altitude.” Wall Street Journal (8 October): C 1.

“During the industry downturn after the September 11, 2001, terrorist attacks, American was one of the most frugal spenders and, in some areas, aggressive cost-cutters as Mr. Arpey avoided the easier path taken by rivals in bankruptcy-court proceedings.  Now, investments to improve operations for the long haul, including better customer service and new aircraft interiors, are adding to the carrier’s high costs.  “They have a lot more work ahead of them than other names because of the fact that they haven’t been through bankruptcy,” said Standard & Poor’s airline equity analyst Jim Corridore, who has a “hold” recommendation on the stock.

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