10.24.03 – (LAA) – AMR Reports 3rd Quarter Operating Earnings, 757 International Staffing, 2004 Benefits Enrollment

Hello. This is Liz Geiss, DFW InfoRep Captain, with the APFA Hotline for Friday, October 24, 2003.

On Wednesday, AMR reported third-quarter operating earnings of $165 million and net earnings of $1 million. Excluding special items related to the company’s restructuring, AMR reported operating earnings of $141 million and a net loss of $23 million. These results compare to an operating loss of $1.3 billion and a net loss of $924 million for the third quarter 2002. AMR CEO, Gerard Arpey, acknowledged the fact that these results were achieved in large part because of the “sacrifices and hard work” of the American employees. The APFA met with American CFO Jeff Campbell yesterday to review in greater detail these quarterly results.

Despite the fact that American remains highly leveraged and faces debt maturities and pension payments, Standard and Poor’s this week revised its outlook on AMR from “negative” to “stable.” Philip Baggaley, an S & P analyst, said that the revision reflects “improved operating results and increased liquidity, with $2.8 billion of unrestricted cash.”

The APFA met with American on Wednesday of this week to review the results of the recall of the 390 Flight Attendants effective December 2, 2003. Of the 390 Flight Attendants offered recall, 352 accepted, 33 rejected, and 5 Flight Attendants did not respond to their recall letter. Flight Attendants returning to active status on December 2 as a result of this recall will be based in STL and LGA. The Training Support Desk began accepting calls today, October 24th, in order to schedule training for Flight Attendants scheduled for recall. The Training Support Desk can be reached by calling 1-800-999-3632 Monday thru Sunday from 0500 until 2030 Central Time. The Company does not plan to offer recall to additional Flight Attendants at this time.

The APFA was formally notified this week by American that it plans to reduced the 757 International Staffing beginning December 2, 2003 pursuant to Article 9.B. of the Contract. The new staffing formula being implemented by the Company will be:

• Trips will be bid with 4 Flight Attendants.
• Flight Attendant 5 will be added at a total load of 110 and block time less than 2:00 or a main cabin meal is served.
• The trigger for adding the number 6 flight attendant will remain the same.

Article 9 of the Contract provides a remedy for the APFA if the union feels that arbitrary changes to staffing formulas creates an unreasonable workload for Flight Attendants. APFA is already in the process of researching the effect this staffing change will have on the membership and will carefully weigh our options in this matter.

The deadline for completing 2004 Benefits Enrollment is October 31, 2003. Enrollment must be accomplished on-line through Jetnet, which is available 24-hours a day. Flight Attendants who have not already completed enrollment should be sure to read all information contained in the enrollment package and the Medical/Dental Q and A’s posted on the opening page of the APFA Web site prior to making their elections. Please remember that changes to benefit elections can be made until the deadline. After that, no further adjustments will be allowed. If you made an adjustment to your ‘Life Insurance’ coverage in the first half of the enrollment period prior to October 15, 2003, please verify on-line that your preferences have been registered. A glitch in the system has been addressed to ensure that Flight Attendants were given the contractual minimum in benefits, if you chose less than the minimum, in error. Employees that chose a level of increased Life Insurance benefits for 2004 were not affected by the glitch in options. As a reminder, the ‘Beneficiary Coverage’ prompts us this year to update our designees on-line. This is an enhancement to the paper enrollment that we filled out as new hires. This may be adjusted at anytime during the year.

From the APFA Health Department: Flight Attendants who have either elected Health Care Flexible Spending Accounts for 2003 or who are considering electing them as part of their 2004 Benefits Enrollment should be aware of certain changes to American’s plan. On October 12, 2003, American Airlines’ Health Care Flexible Spending plan was approved to allow employees to be reimbursed for qualifying over-the-counter non-prescription products through their Health Care Flexible Spending Account. This move was a result of a government ruling on September 3, 2003. Studies show that families spend on average $185.00 per year purchasing over the counter products that now qualify for flexible spending reimbursement. Please take this information and the changes to the plan into consideration when determining an amount for your Flexible Spending Account. More information on the changes to American’s plan and a list of non-prescription products that qualify for reimbursement can be found on the Health Page of the APFA Web site. It is important to remember that if you do not exhaust funds in your Health Care Flexible Spending Account by the end of any calendar year, you lose the remaining balance.

It has come to the attention of the APFA that the Company ran a payroll audit recently. This audit identified several Flight Attendants that may be in an overpayment situation. If the Company has notified you that you are indeed in an overpayment situation and you would like assistance from the APFA, please contact your APFA Base Chair for assistance. Their contact information can be found on the web site and in the center section of Skyword.

The APFA Safety, Health, and Scheduling Departments would like to remind Flight Attendants to take a moment to complete the Reduced Rest Survey located on the opening page and on the Safety, Health, and Scheduling pages of the APFA Web site. In order for the APFA to effectively address this issue not only with the Company but with Congress and regulatory agencies, we must have as much information as possible. Your input through this survey is very important.

A Retirement Seminar will be held in Terminal C Operations in DFW on October 28th from 1000 until 1400. Flight Attendants from all bases who are interested in learning more about retirement are invited to attend.

The Missouri Career Center is sponsoring a job fair in St. Louis on October 29th from 0900 to 1300 at the Machinist Hall located at 12365 St. Charles Rock Road in Bridgeton, Missouri. All furloughed American Airlines employees are encouraged to bring their updated resumes to this event.

There will be a JFK and LGA Base meeting held on November 6th, 2003 at the New York LGA Marriot Hotel. The meeting will be from 1100 to 1300. The address of the hotel is 102-05 Ditmars Boulevard in East Elmhurst, NY. The phone number of the hotel is 718-565-8900. There will be a $5.00 charge for parking, however, there is also free shuttle service provided by the hotel, to/from the LGA Airport.

InfoRep Day in Ops will continue next week in Los Angeles on October 28th from 1030 until 1430 and in San Jose on October 29th from 0930 until 1330. This is your chance to learn firsthand more about the InfoRep Program. If you are interested in becoming an InfoRep, please contact your Base Chair.

In Industry News:

American announced this week that it would maintain its three existing maintenance bases located in Kansas City, Tulsa, and Ft. Worth. American reached a 25-year agreement with the city of Kansas City and the state of Missouri that would allow it to retain a portion of the wide-body hangar and related shops. The airline plans to maintain current operations at the Alliance Maintenance Base and actually add jobs in Tulsa as part of its realignment of the various facilities. American said it would continue to work with the city of Ft. Worth to identify ways to lower its operating costs.

The International Association of Machinists representing the Mechanics at US Airways were granted a Preliminary Injunction on the right for US Airways to use a company in Mobile, Alabama to perform maintenance on 10 Airbus aircraft. The third-party maintenance provider had already begun heavy maintenance on two planes, which was halted by the order. US Airways management said it would seek an emergency stay of the order.

For additional news on the airline industry and American Airlines, please visit the News and Events page of the APFA Web site.

That is it for this edition of the APFA Hotline. Visit the web site for the latest information and past editions of the hotline.

Please remember to set your clocks back one hour prior to going to bed on Saturday night October 25th!

There are 6,150 American Airlines Flight Attendants currently on furlough.