American Eagle President: Forget Planes, We'll Grow Ground Handling Business

Tickers in this article: AAL

DALLAS (TheStreet) -- American Eagle President Pedro Fabregas said he is disappointed that the airline's pilot leaders voted not to send a tentative contract agreement out for a vote, but American Eagle won't shut down even though it has apparently lost the possibility of gaining up to 150 new aircraft.

The carrier will look increasingly to ground handling work for its future, Fabregas wrote in a letter sent Thursday to the 3,000 pilots at American Eagle, the regional airline partner of American Airlines .

The master executive council of the American Eagle Air Line Pilots Association American Eagle chapter said late Wednesday that it had rejected the tentative agreement and expects the carrier to pursue liquidation.

But in his letter, Fabregas wrote that the "MEC's statement asking us to provide a timetable for the company's 'liquidation' is not something we can provide as we are not planning to shut down the airline.

"Our ground handling operation continues to thrive and we have added new business and employees there at a rapid pace," Fabregas said. Also, American Eagle "will continue to work toward making our flying operation as competitive as possible while addressing the downsizing of our fleet and related staffing in the coming years."

Fabregas said American informed him it will begin looking for another carrier to operate the 60 Embraer 175s it has ordered and the 90 it may order. "American has held off on making this decision as long as possible, as they wanted to give our pilots the chance to do this flying," he said. "American can't wait any longer and will begin these efforts immediately."

He noted that American Eagle began negotiating the tentative agreement in December, that the MEC agreed to an agreement in principle on Jan. 10, and that the parties then worked to translate the agreement into contract terms.

The MEC's "decision to deny our pilots a vote means the loss of what would have been a very important opportunity for each individual pilot, our company and all the people who work here," he said.

Written by Ted Reed in Charlotte, N.C.

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