FORT WORTH — American Airlines newest chief executive remotely rang the bell to open trading on the NASDAQ in New York from the airline’s headquarters in Texas on Monday morning as it celebrates the closing of its merger with US Airways.
Surrounded by hundreds of pilots, flight attendants and corporate employees, American’s new CEO — Doug Parker — activated the trading bell in a large first floor room of the airline’s long-time headquarters at 8:30 a.m.
"We have some really big shoes to fill here and we know that," said Parker. "Our goal is to restore American Airlines as the greatest in the world."
The event was originally scheduled to take place inside a hangar at Dallas/Fort Worth International Airport with a couple of aircraft serving as a back drop, but American canceled that venue because of the lingering effects from Friday’s ice storm.
Parker’s bell ringing is symbolic in that it closes the merger with US Airways, begins trading of American’s new stock under the symbol AAL and is the first official duty he’ll perform as the new CEO.
American’s corporate parent is now named American Airlines Group, trading under AAL on the NASDAQ. The name and stock symbol AMR is history.
Tom Horton, American’s CEO during its previous two years of bankruptcy, will stay on for an additional year as chairman of the board, though he will not have an office at the airline’s headquarters anymore. He did not speak publicly during the ceremony or to reporters afterwards.
Whether Horton gets paid a severance is up to the new board of directors. U.S. Bankruptcy Judge Sean H. Lane refused to approve the almost $20-million payment during reorganization.
But, Monday marks a new beginning for American, which is the largest employer based in North Texas.
Operating more than 6,700 daily flights to 336 destinations in 56 countries with an estimated 952 aircraft, the new American is now the largest airline in the world.
As of today, pilots will receive half of their 13 percent equity stake in the company in the form of AAL stock. It equates to about $120,000 per pilot, according to the Allied Pilots Association. The union representing American’s pilots said the equity stake will be partial compensation for the loss of the pilots’ pension. Flight attendants, on average will receive $15,000 of AAL stock for their 3 percent equity stake, according to the Association of Professional Flight Attendants.
Despite closing the merger on paper, the airlines will not officially become one until the FAA grants a single-operating certificate in the next two years.
"In the meantime, customers should continue to do business with the airline from which travel was purchased just as they did before the merger," American said in a statement. "In short, it is “business as usual.” The airlines’ separate websites, aa.com and usairways.com, as well as the two airlines’ reservations systems and loyalty programs, will continue to operate separately until further in the integration process."
Still, customers will begin to see changes in early January including the ability to earn and redeem miles when traveling on either American Airlines or US Airways, reciprocal American Admirals Club and US Airways Club benefits, and reciprocal elite recognition.
After four consecutive years of annual losses, American Airlines filed for bankruptcy protection almost two years ago on Nov. 29, 2011. American had $24-billion in assets and $29-billion in debt.
The airline used bankruptcy to reduce labor costs by 17 percent and freeze pensions, erasing $2 billion from its bottom line and increasing revenue by a billion dollars annually.
American eliminated 8,600 positions, including 2,200 flight attendants, 3, 800 TWU-represented employees, 1,200 management and support staff and 1,400 agents, reservation representatives and planners.
The airline is in the process of renewing its fleet and replacing hundreds of MD-80s it used domestically for years.
Still, labor unions from both airlines have to combine and flight attendants at American and US Airways have already become entangled. Plus, US Airways pilots never officially merged America West pilots when the two airlines merged in 2005.
Taking over following the merger of US Airways and America West Airlines in September 2005, Parker is the longest serving current chief executive of a U.S. airline.
He actually began his career in aviation at American Airlines in 1986 after earning an MBA from Vanderbilt University. Parker held a number of financial management positions at American until 1991. He also worked for Northwest Airlines before joining America West.