American Airlines 2010 Annual Report Download - page 22

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We are increasingly dependent on technology and could be adversely affected by a failure or disruption
of our computer, communications or other technology systems.
We are heavily and increasingly dependent on technology to operate our business, reduce our costs and enhance
customer service. The computer and communications systems on which we rely could be disrupted due to
various events, some of which are beyond our control, including natural disasters, power failures, terrorist attacks,
equipment failures, system implementation failures, software failures and computer viruses and hackers. We have
taken certain steps to help reduce the risk of some (but not all) of these potential disruptions. There can be no
assurance, however, that the measures we have taken are adequate to prevent or remedy disruptions or failures
of these systems. Any substantial or repeated failure of these systems could impact our operations and customer
service, result in the loss of important data, loss of revenues, and increased costs, and generally harm our
business. Moreover, a failure of certain of our vital systems could limit our ability to operate our flights for an
extended period of time, which would have a material adverse impact on our operations and our business. In
addition, we will need to continue to make significant investments in technology to pursue initiatives to reduce
costs and enhance customer service. If we are unable to make these investments, our business could be
negatively impacted.
We are at risk of losses and adverse publicity which might result from an accident involving any of our
aircraft.
If one of our aircraft were to be involved in an accident, we could be exposed to significant tort liability. The
insurance we carry to cover damages arising from any future accidents may be inadequate. In the event that our
insurance is not adequate, we may be forced to bear substantial losses from an accident. In addition, any
accident involving an aircraft operated by us could adversely affect the public’s perception of us.
Interruptions or disruptions in service at one or more of our primary market airports could have an
adverse impact on us.
Our business is heavily dependent on our operations at our primary market airports in Dallas/Ft. Worth, Chicago,
Miami, New York City and Los Angeles. Each of these operations includes flights that gather and distribute traffic
from markets in the geographic region around the primary market to other major cities. A significant interruption
or disruption in service at one or more of our primary markets could adversely impact our operations.
The airline industry is heavily taxed.
The airline industry is subject to extensive government fees and taxation that negatively impact our revenue. The
U.S. airline industry is one of the most heavily taxed of all industries. These fees and taxes have grown
significantly in the past decade for domestic flights and various U.S. fees and taxes also are assessed on
international flights. In addition, the governments of foreign countries in which we operate impose on U.S. airlines,
including us, various fees and taxes, and these assessments have been increasing in number and amount in
recent years. Certain of these fees and taxes must be included in the fares we advertise or quote to our
customers. Due to the competitive revenue environment, many increases in these fees and taxes have been
absorbed by the airline industry rather than being passed on to the passenger. Further increases in fees and
taxes may reduce demand for air travel, and thus our revenues.