American Airlines cuts domestic flight schedule

By Tom Stundza -- Purchasing, 5/21/2008 10:41:00 AM

American Airlines today announced a sharp cut in its domestic flight schedule, including a fourth-quarter reduction in domestic capacity of as much as 12%, citing high fuel prices, concerns about the economy and a “difficult competitive environment.”

Chairman and CEO Gerard Arpey of parent AMR says, “the airline industry as it is constituted today was not built to withstand oil prices at $125 a barrel, and certainly not when record fuel expenses are coupled with a weak U.S. economy.”

The Wall Street Journal is reporting that American Airlines also plans to retire at least 75 aircraft—primarily MD-80s but also Airbus A300s—and has unveiled several revenue-enhancement efforts, including a $15 fee for the first checked bag on domestic flights for low-fare customers and non-frequent fliers. It’s the first carrier to start charging some customers for the first checked bag—just several months after carriers began hitting some customers with fees on a second checked bag for the first time—American is raising a host of other fees by $5-$50.