New poll - AA and the financial situation

Discussion in 'American Airlines | AAdvantage' started by kansaskeith, Oct 4, 2011.  |  Print Topic

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Are AA's financial condition/bankruptcy rumors affecting your travel plans and/or mileage strategy?

Poll closed Oct 11, 2011.
  1. Yes, I have already begun booking with another carrier because of these problems

    0 vote(s)
    0.0%
  2. Yes, haven't changed bookings but am switching my mileage plans/strategy to another firm

    3.6%
  3. Unsure, haven't made any changes but am worried and am watching news on this

    28.6%
  4. No, even if AA should file bankruptcy, AAdvantage members will somehow be protected

    46.4%
  5. No, American Airlines will get through the current financial problems

    21.4%
  1. kansaskeith

    kansaskeith Gold Member

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    I thought it might be interesting to see whether AAdvantage members are changing anything because of the financial quandary AA faces. If you post any comments, might also note if you are standard and elite, and, if elite, which level.
     
  2. HaveMilesWillTravel
    Original Member

    HaveMilesWillTravel Gold Member

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    I am not an AA elite and don't fly them regularly, but I am interested in this due to the roughly 300k AA miles in the two accounts I manage (mine + wife). I believe those will be safe even if AA goes through ch.11, so I am not taking any steps to burn them ASAP.
     
  3. Jimgotkp
    Original Member

    Jimgotkp Gold Member

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    I agree with HaveMilesWIllTravel... I've been reading a few threads about this and it seems like whenever a company filed a Chap. 11 the miles/points were fine.
     
    zpaul, jmrich1432 and jbcarioca like this.
  4. miamigrad
    Original Member

    miamigrad Silver Member

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    I'm not changing a thing, and not worried. In fact, if bankruptcy makes AA a stronger carrier (which is the intent of any bankruptcy), then I hope that AA would go that route.

    The AAdvantage program is an extremely valuable asset to AMR and the talk of wiping out members' miles just doesn't make sense to me from a business standpoint.
     
  5. jmrich1432
    Original Member

    jmrich1432 Silver Member

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    Agreed!

    I don't want to loose all those miles from the Citi signups, but I don't think it will be an issue.
     
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  6. TheBeerHunter
    Original Member

    TheBeerHunter Silver Member

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    I am not concerned with my miles so much as the pile of gift cards I was planning to buy from Costco in order to meet the spend on my latest Citi Amex before they change the lifetime MM criteria to be BIS only...

    Since they appeared at Costco my husband and I have purchased about $6K worth of the gift cards, but we've applied all but two or three to future travel already, so they're "spent". I'm a bit more concerned about what would happen with the value of gift cards if I were to buy a bunch and hold them, if AA filed for BK...
     
  7. Redhead

    Redhead Silver Member

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    When the other airlines filed for Chap 11, mileage balances were honoured. Since AAdvantage represents a HUGE financial benefit to AA, they would be crazy to mess with it. That said, I am choosing to switch some of my creit card spend to the SPG card rather than my AA card, even though at the moment I have a 1.5miles /US$1 offer through November on the Citi card
     
  8. kansaskeith

    kansaskeith Gold Member

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    Yes, Redhead, that generally is historically true, with at least one possible exception I can recall. In CO's first BK, way way back, there was some interruption to Travelbank, predecessor to OnePass. Don't think people lost everything, but there was a hiccup.
     
  9. gleff
    Original Member

    gleff Co-founder

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    Some analysts contend that the current pricing of AMR credit default swaps imply an 82% likelihood of bankrupty within the next 5 years. (Cost to insure AMR debt has gotten pretty expensive...)

    But in the event of bankruptcy, miles will be fine.

    The only thing to fear is liquidation, no one expects liquidation, and that's the only point at which one wonders whether the profitability of AAdvantage could mean the entity survives as a going concern independent of the airline.

    As long as we're not staring at liquidation, it's no worries for the miles, and in fact it may even be good -- through lots of extra bonuses and a lower likelihood of award chart inflation.
     
  10. Philphactor
    Original Member

    Philphactor Silver Member

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  11. mowogo
    Original Member

    mowogo Gold Member

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    So pretty much, unless they can completely overhaul their cost structure, they will run out of money in 5 years. Given how toxic labor relations are for negotiating the new contracts, I see a trip through bankruptcy just to be able to force new contracts rather than because they run out of money.
     

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