FORT WORTH- American Airlines (AA) CEO Robert Isom openly challenges Boeing’s operational effectiveness, expressing frustration over five years of continuous disruptions.
Isom’s statement to CNBC characterizes Boeing as a “distraction” to airline operations.
American Airlines CEO on Boeing
Boeing faces intensifying scrutiny following January’s Alaska Airlines (AS) door plug incident. The manufacturer confronts mounting safety investigations from regulatory authorities amid declining public confidence.
The company’s challenges escalate with an extended machinists’ strike. The International Association of Machinists and Aerospace Workers rejected Boeing’s latest contract proposal, potentially impacting production schedules.
American Airlines demonstrated resilience in its own quarterly results, generating record revenue of $13.6 billion despite posting a $149 million loss. The airline’s stock rose approximately 1% following the announcement.
American Airlines reduced its total debt by $360 million in the third quarter, advancing toward its target of $15 billion in debt reduction by 2025. The airline has achieved more than $13 billion in debt reduction thus far. The company maintains $11.8 billion in total available liquidity, combining cash, short-term investments, and undrawn credit facilities.
The quarter’s financial results include $354 million in net special items after taxes, primarily stemming from one-time charges related to the ratification of the mainline flight attendants’ new collective bargaining agreement.
For financial reporting clarity, American Airlines defines total debt to encompass debt, finance and operating lease liabilities, and pension obligations. The company’s forward-looking adjusted earnings per diluted share guidance excludes net special items, as their nature and amount remain undetermined.
American Airlines achieved these results while navigating several operational challenges, including the CrowdStrike outage and disruptions from Hurricanes Debby and Helene.
$6 Billion Loss
Boeing’s newly appointed CEO Kelly Ortberg, bringing aerospace industry expertise, commits to implementing fundamental cultural and performance improvements. This leadership change signals Boeing’s acknowledgment of the necessary organizational transformation.
Boeing sustained a $6 billion loss against $17 billion in revenue during the third quarter, facing headwinds from an ongoing strike and setbacks in its commercial and defense divisions.
The company’s commercial unit secured 49 new orders and completed 116 aircraft deliveries, maintaining a substantial backlog of 5,400 aircraft valued at $428 billion.
Boeing Board Director Dave Ortberg acknowledged the company’s struggles, stating, “It will take time to return Boeing to its former legacy, but with the right focus and culture, we can be an iconic company and aerospace leader once again.”
The aerospace manufacturer’s challenges have impacted its relationships with major customers. American Airlines CEO Robert Isom expressed his concerns about Boeing’s performance.
“We need Boeing to be strong,” Isom emphasized in discussions with Boeing CEO Dave Calhoun. “We need them to deliver quality aircraft on time. I’ll be welcoming that phone call when Boeing says we’re going to do that.”
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