Bankrupt AMR: Cut Flights, Possible Merger
DALLAS TheStreet) -- The bankruptcy of American Airlines and parent AMR (AMR) could mean fewer flights and fewer seats for passengers, even on some prestigious routes, as well as a turning point for airline investors. Competitors' shares rose, with the three remaining legacy carriers registering double-digit gains last week.
Passengers in a variety of markets could be impacted.
|Passengers are likely to lose routes with an American Airlines bankruptcy, but Delta, JetBlue, US Airways and United are already seeing stock gains.|
American's principal hubs in Dallas, Miami and Chicago should escape the bulk of the capacity trimming, and American may also be hesitant to reduce flying between the U.S. and the U.K., Ticonderoga analyst James Higgins says. But flight cuts should be steeper in markets outside the three major hubs, he says, and various analyst agree they see impending cuts in Los Angeles and New York -- which despite being keys to American's cornerstone strategy are not places where it dominates.
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