AMERICAN AIRLINES FILES FOR BANKRUPTCY

Yikes! Does this mean you should:


1.  Cancel your AA Christmas flight to Grandma's? 
2.  Re-book it on another carrier - at a probably much higher price - just in case?
3.  Never, ever again - no matter how good the deal may be - buy another AA or American Eagle ticket?


As Sportin' Life sang in 'Porgy & Bess', 'It ain't necessarily so.'


The reason: filing for Chapter 11 bankruptcy protection in the real world is a lot different than going bankrupt in 'Monopoly'. 


How so?


In the Parker Brothers version, you go the 'B' word & you're out of the game, completely broke, finished, the end. 


But in our RW, going 'B' could be a ploy that actually cuts costs. In other words - a good business decision.


And listen to this : AA was the only major full fare US airline left who hadn't gone bankrupt.


Yes, my dears, the Deltas & Uniteds have already flown this route.


That means - unlike D & U - AA still has to honor its union contracts. This costs over $600 mil more per year than the competition to keep on flying.


So by filing C11, they can be tougher at the negotiation table.


Ok, they may lower operational costs by picking the pockets of union workers, which leaves a very bad taste in a lot of mouths - including mine.


But the bottom line may be that they will - like D & U - continue flying.


AA states:


'...(we) expect to continue normal business operations throughout the reorganization process...operating normal flight schedules, honoring tickets and reservations as usual, and making normal refunds and exchanges. American's AAdvantage frequent flyer program is not affected.'


They also say they will:


1. Fly normal schedules with 3,300 daily flights.
2. Honor tickets and reservations.
3. Fully maintain the AAdvantage frequent-flyer program & keep miles intact.   
4. Continue Admirals Club amenities for eligible customers.
5. Provide employee wages and health benefits without interruption.


Since AA is on track to lose over a billion $ this year, you may question the truthfulness of the above promises. 


But - looking how other airlines handled their financial messes after 'B' - there's a good chance that they are true.


However, a wise traveler should keep an eye - through the papers, TV, this blog - on AA to make sure they continue to fly straight.


Or even at all.


In the meantime, give Grandma a big Christmas smooch - right on her kisser - from me.


And it's probably a good idea to pass on that 4th helping of her butter caked mashed potatoes.