American Airlines 1997 Annual Report Download - page 5

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strategic imperative, because — despite great
efforts — we have not been able to bring our costs to
fully competitive levels. American’s cost per available
seat mile for 1997 increased by 4 percent. Some of
that increase is attributable to higher aircraft mainte-
nance costs and some to higher labor costs associated
with contractual scale and seniority pay increases. We
also spent a substantial amount — and will spend
more in 1998 — to ensure that all of our computer
systems will be year 2000 compliant.
In addition to good financial results, the year
produced a number of favorable developments that
augur well for the years to come.
One of these was agreement on a new contract
with the Allied Pilots Association which runs through
August 2001.
Another was a long-term agreement between
American Eagle, our regional affiliate, and its pilots.
That contract indexes Eagle pilot compensation to a
regional industry average, and precludes work stop-
pages for 16 years. Details of Eagle’s continuing
3
AMR’s success in 1997
was a direct result of
our employees’ hard
work, enthusiasm and
dedication. We have the
best people in the
industry pushing our
various enterprises to
the forefront of their
respective fields, and
that translates into
better service for our
customers and better
value for our
investors.