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American grounds more flights, may need more time
2008-04-10
American Airlines has canceled about 570 flights scheduled for Friday, raising to more than 3,000 the number this week it has grounded to reinspect the wiring on its MD-80 fleet for a second time. The company's chief executive said on Thursday it may need several more days to finish the job, which it had hoped to complete by Saturday. The disruption has affected more than 300,000 passengers, including Friday's schedule cuts, and wreaked havoc with its operations at big airports like Chicago and Dallas. The unit of AMR Corp grounded its entire stable of nearly 300 MD-80 medium-range airliners on Tuesday, prompting 460 flight cancellations that day. It canceled 1,094 on Wednesday and another 930 on Thursday. American runs about 2,300 mainline departures daily. Delta Air Lines Inc and Alaska Airlines Group canceled a few dozen flights, combined, over the same issue with their MD-80s. American's chief executive, Gerard Arpey said on Thursday the carrier had unsuccessfully asked the Federal Aviation Administration (FAA) for an alternative to grounding the planes, because it did not believe the problem posed an imminent safety threat. Arpey apologized to passengers and said he had no doubt American operates safely. "I put my kids on these airplanes all the time," he told a conference call with reporters. Airline officials had said on Wednesday they hoped to have the situation in hand by Saturday. But Arpey said American is trying "to stay ahead" of the problem and it could take "several more days to get back up to speed." PRESSURE The inspections relate to a 2006 FAA order to ensure that wiring in the MD-80's right wheel well is properly installed and secured to guard against electrical shorts and fire. The FAA, under pressure from Congress and government watchdogs to step up oversight, demanded in March that American reinspect MD-80s to ensure wire bundles were properly secured. American grounded planes two weeks ago and resecured wiring where necessary to comply with the directive, but a follow-up inspection of several planes by the FAA found incomplete work. "We were not in precise compliance and we need to be," Arpey said. American said the March inspections revealed no age-related wear of wiring that underpinned the original concern about electrical shorts, and there have been no incidents related to the issue. Arpey defended maintenance personnel responsible for interpreting FAA orders and charting out a plan for doing the work. "Our mechanics did not fail us in any way," he said. Asked whether FAA was being too tough on American, Arpey said the agency was doing its job. "The FAA is under its own set of pressures. I believe they are simply holding the industry to a high standard." The FAA's regional safety office in Dallas, where American is based, has been harshly criticized by Congress and the Transportation Department inspector general for its oversight of Southwest Airlines Co. Senior agency officials have been questioned closely by lawmakers about a system that allows airlines to self-report compliance with safety directives. Inspection lapses at Southwest triggered an industry-wide FAA review in recent weeks of how carriers comply with directives, leading to closer scrutiny of MD-80s. The FAA has proposed fining Southwest $10.2 million for knowingly flying Boeing Co 737 aircraft that had not been inspected closely enough for fuselage cracks. SAFETY OR POLITICS? John Goglia, a former member of the National Transportation Safety Board and an airline maintenance expert, agreed with American that the MD-80 case posed no imminent safety threat and there was no need to ground all the planes. He suggested the politically charged climate in Washington is playing a large part. "If we were to turn back the clock six months and American came forward and voluntarily asked for an alternative means (to comply) the FAA in all likelihood would have approved it," Goglia said. Standard & Poor's rating agency said American would likely experience a "noticeable financial impact" in the second quarter due to cancellations and the cost of rebooking passengers. "Perhaps the only factors working in American's favor are that its competitors' planes are already so crowded that it is not possible to book many passengers on other airlines," S&P said. Arpey did not have a firm figure for the financial impact so far but believes it will "be in the tens of millions of dollars." AMR shares closed up 7.6 percent at $9.87 on the New York Stock Exchange on Thursday, after losing 11 percent on Wednesday. Airline shares were broadly higher with the Amex airline index up 2.8 percent. "Everybody is up, it's kind of like a little rebound from yesterday," said Ray Neidl, airline analyst at Calyon Securities. (Additional reporting by Kyle Peterson; editing by Tim Dobbyn, Gary Hill)
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