AMR Corporation - 7.875% Public Income Notes (PINES) (AAR)

[mrholty]

Yeah, I think the secured will get paid. Notice that these guys went in without DIP financing as nowdays BK doesn't affect future bookings like it used to.

Seeking this seem to settle at 16% (4/25) this could be interesting. Need to do some research on what happened with DL and NW when they went BK ahead of pension payments just like AMR did.

My expectation:
Employees - Wages will not cut much, new employees (Pilots) are already on a B scale but work rule changes.
They are going to dump the 762 fleet (why they have been using these as domestic transcons has been stupid. Quicker retirement of MD-80s and my guess is a net reduction of 75 planes from service.

American Eagle will get destroyed as AMR will use this to cancel their agreement with them due to their high market rates and they hold the leases on the EMB-145s (50 seaters). They will hire some other regional and due to scope change with pilots will add 70 seaters.

Hubs-
DFW and MIA fine. I expect shrinking in ORD and LAX.

After BK - They will try to buy B6 and AS.

This may be an interesting play as they are using the DL playbook, imo.