It’s all over the news. American Airlines has filed for Chapter 11 bankruptcy protection. When purchasing tickets, should you now avoid American Airlines?
No. With a few exceptions, you can purchase tickets on American with confidence.
Chapter 11 is not the fire-sale bankruptcy where the courts sell off all the assets, down to the last cocktail napkin. Chapter 11 protects a company while it reorganizes and renegotiates with vendors. In the case of an airline, it will allow them more maneuvering room with unions and airplane leasing companies.
Virtually all major US carriers still in existence have been through Chapter 11 – Continental, USAirways, and Delta, to mention just a few. They all emerged successfully, and are financially stronger than ever.
If you are flying on a major route with American Airlines, you should be fine. American Airlines is in the business of flying – the are not going to abandon lucrative routes, especially to Latin America (a huge stronghold for them).
There will no doubt be some schedule changes, or reductions in service, on many routes. This is not unusual, however – airlines constantly adjust their schedules, trying to maximize revenue. Any time you book a plane ticket, the possibility exists that there will be a schedule change. American’s Chapter 11 filing is only one of many factors that influence schedule changes.
In the event of a schedule change, the airline will offer you the new best connection that they have available. If the schedule change is significant, and their new schedule is unacceptable, you may be able to get a full refund. In most cases, however, schedule changes result in minor changes to the itinerary.
The one scenario where you might consider another airline is if you are departing from a small city in the US. Realistically American will have to make some cuts. Those cuts are most likely to come from less lucrative routes, which are often the smaller cities. In that instance, you should look into alternative carriers.
What happens if you do purchase a ticket, and the carrier withdraws from the market? The real answer is, it depends.
If there is another alternative, the airline may pay for you to fly with another carrier. Or you may be able to work out a different routing with them – departing from a different nearby town, for example. And again, you can always ask for a full refund.
Your Exito Travel agent will be happy to discuss the risks and benefits of any itinerary, when you make your reservation. We are committed to keeping our clients informed, so that you can make your travel decisions with confidence.