AMR Wants to Layoff 13,000, End Pensions

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AMR (AAMRQ), the parent of American Airlines, detailed its plans to emerge from bankruptcy today, saying it wants to lay off 13,000 people and end its defined pension plans. The company is asking all groups within the airline, including management, to cut 20% from costs.

“The plan targets an annual financial improvement of more than $3 billion by 2017, including $2 billion in cost savings and $1 billion in revenue enhancements.”

Instead of pensions, AMR would contribute to 401K’s. Certain operations may also be outsourced.

“These are painful decisions,” Chairman and CEO Tom Horton continued, “but they are essential to American’s future. We will emerge from our restructuring process as a leaner organization with fewer people, but we will also preserve tens of thousands of jobs that would have been lost if we had not embarked on this path – and that’s a goal worth fighting for.”



Original Article Source by Barrons.com