TULSA - American Airlines and American Eagle's parent companies have filed for Chapter. 11 bankruptcy protection.
AMR Corp. and AMR Eagle Holding Corp. said Tuesday that they filed voluntary petitions to reorganize, saying it's in the best interest of the companies and its shareholders.
American Airlines employs nearly 7,000 at its maintenance base at Tulsa International Airport. There is no word on how Tulsa jobs could be affected by the bankruptcy. However, most other major carriers have outsourced their maintenace operations to independent companies --- some in other countries.
The nation's third-largest airline also said Tuesday that CEO Gerard Arpey had stepped down and was replaced by company president Thomas W. Horton.
AMR Corp. has continued to lose money while other U.S. airlines returned to profitability in the last two years.
A company spokesperson said the board of directors unanimously decided to file for bankruptcy after meeting Monday in New York and again by conference call on Monday night.
American said it would operate normally while it reorganizes in bankruptcy. The airline said it would continue to operate flights, honor tickets and take reservations. It said the AAdvantage frequent-flier program would not be affected.
However, officials say as the company goes through a restructuring it will probably reduce the flight schedule "modestly," with corresponding cuts in jobs.
The company will delay the spin-off of its regional airline operation, American Eagle, which was expected in early 2012. AMR Eagle Holding Corp. also filed for bankruptcy.
American and Southwest were the only major U.S. airline that didn't file for bankruptcy protection in the aftermath of the 2001 terrorist attacks that triggered a deep slump in the airline industry. The last major airline to file for bankruptcy protection was Delta in 2005.
Speculation about an AMR bankruptcy grew in recent weeks, however, as negotiations with pilots and other workers over cost-saving labor contracts seemed to stall. The company said that labor-contract rules forced it to spend at least $600 million more per year than other airlines.
The spokesperson said that there was no single factor that led to the bankruptcy filing. He said the company needed to cut costs in view of the weak global economy and high, volatile fuel prices. The average price of jet fuel has risen more than 50 percent in the past five years.
American was the world's biggest airline as recently as 2008, but has fallen behind United and Delta after those two companies bought other airlines.
Fort Worth-based AMR lost $162 million in the third quarter and has posted losses in 14 of the last 16 quarters.
AMR has about $4 billion in cash and has announced plans to order 460 new narrow-body planes used primarily in the U.S., plus other jets for longer flights.
American was founded in 1930 from the combination of more than 80 smaller carriers. It now flies about 240,000 passengers per day and has about 78,000 employees.
The airline operates out of five major hubs in New York, Los Angeles, Dallas/Fort Worth, Chicago, and Miami. It has major international partnerships with British Airways and Japan Airlines.
Its major maintenance bases are in Tulsa, Ft. Worth and Kansas City.