Found To Be In Full Compliance With Pilot Contract

A ruling by an independent arbitrator indicates that American's proposed Joint Business Agreement with British Airways and Iberia does not violate its contract with the Allied Pilots Association. 

Earlier this week, APA had staged informational pickets in Washington, DC at the Department of Transportation urging DOT not to grant the anti-trust waiver for a Joint Business Agreement between American Airlines, British Airways, and Iberia Airlines.

After the ruling was made public, American issued the following statement:

"After a formal presentation of evidence and arguments in an arbitration board hearing, an independent arbitrator has ruled that American's proposed Joint Business Agreement (JBA) with British Airways and Iberia does not violate its pilot contract. The arbitrator also conducted a series of mediated discussions with the Allied Pilots Association (APA), during which American offered concrete proposals to address APA's concerns about job security. The company also offered protections that American's share of the flying as part of the JBA would remain relatively proportional over time. The company believed that this would address the APA's core concerns, but instead the APA rejected it. The arbitration decision cited a history of prior contract negotiations supportive of international codesharing with British Airways and the likely economic benefits to American of the Joint Business Agreement.

American is pleased with the arbitrator's decision and remains optimistic that the United States Department of Transportation (DOT) will conduct a thorough assessment of its application and conclude that it will improve competition and benefit customers. This agreement is designed to encourage growth and increase revenues so all the participating airlines and airline employees will benefit. It will also offer customers access to an expanded network with seamless service around the globe.

The Joint Business Agreement is expected to help American generate needed additional revenue that will enhance its ability to invest in improved products and services for our customers and to continue to provide great jobs for its employees. It's important to remember that the proposed Joint Business Agreement with British Airways and Iberia is based on a revenue sharing arrangement, which means the only way an airline gets to share in the revenues is to fly. As a result, the more AA flies, the more revenue it would receive. The less AA flies, the less revenue it would receive.

The financial benefits created by the agreement and antitrust immunity will allow American to be much more competitive on corporate contracts, offer consumers greater access to discounted fares and routing choices, and improve opportunities for growth - all of which is expected to lead to additional revenue.

Unfortunately, leaders of the Allied Pilots Association continue to disagree with this important initiative. Their statements and actions seem to be in direct contrast to their purported goals in negotiations: creating more opportunity and increasing job security for AA pilots.

The proposed American Airlines, British Airways, Iberia Airlines antitrust immunity proposal has the support of 28 U.S. Senators, 135 U.S. Representatives, 40 Governors, 109 Mayors and 131 airports from around the nation. In total, there have been more than 3,300 letters of support for the application, including 615 travel related organizations, 324 economic, education and not-for-profit organizations, and 442 corporations, small business and for-profit organizations.

With the expansion and strengthening of Star and SkyTeam alliances, American and its fellow applicants believe that oneworld needs antitrust immunity to compete on a level playing field. The company believes its plans for a joint business agreement with Iberia and British Airways will allow oneworld to compete on equal footing, which will benefit customers, communities, shareholders and employees. The companies' application for antitrust immunity is pending with the DOT and they continue to discuss the benefits of their plans with regulators in the European Union."

FMI: www.american.com, www.ba.com, www.iberia.com/us/