Flightstar president uncertain of American Airlines bankruptcy's local effect

Flightstar president uncertain of American Airlines bankruptcy's local effect

SAVOY — Up in the air.

That pretty much describes the future of American Airlines, as well as the future of American Eagle service to Champaign-Urbana.

Since American Airlines filed for Chapter 11 bankruptcy reorganization last November, the airline's future has been clouded by the question of whether it will eventually merge with another airline.

US Airways has been particularly aggressive in showing interest in American, going so far as to court American's labor unions.

There's also speculation that American might spin off American Eagle, its wholly owned regional airline.

At Willard Airport in Savoy, American Eagle has six flights a day to Chicago's O'Hare Airport, as well as a daily flight to Dallas/Fort Worth International Airport. Both those airports are hubs for American.

Locally, few people outside American Airlines have as good a handle on American's business in and out of Willard Airport as Bill Giannetti.

Giannetti is the president of Flightstar, which has provided maintenance service for American Eagle flights at Willard for 20 years.

Giannetti said he can't predict what American Airlines' bankruptcy will mean for air service at Willard — or for Flightstar's business.

"Unfortunately, we have no idea," he said.

But Giannetti said it wouldn't make any sense for American to leave Champaign-Urbana entirely because American Eagle has the market "sewn up."

But the situation is complicated by the range of possibilities, including a combination with US Airways and a spin-off of American Eagle.

An analysis by Boyd Group International, an aviation consulting and research firm based in Evergreen, Colo., said pension costs and debt expense are the big factors behind American's bankruptcy. Without those, the report said, American would be "strongly profitable."

According to the analysis, it's not clear a US Airways-American merger would be that great because the airlines have few synergies.

What is clear, the consulting firm said, is that American needs to get rid of the smaller aircraft used by American Eagle because high fuel costs make those planes impractical.

Giannetti agrees that American is likely to phase out smaller aircraft, including the Embraer regional jets it flies here. Embraer, a Brazilian aircraft manufacturer, makes 37-seat ERJ 135s, 44-seat ERJ 140s and 50-seat ERJ 145s.

"The industry has pretty much come to the realization that 50-seat jets or less don't work," Giannetti said.

"These are no longer viable in the airline world. It's going to a minimum of 70: 70-, 90- and 100-seaters," he said. "Our service will change as they retire Embraers."

But Giannetti said he expects a gradual transition. Replacing 200 such aircraft would likely be a five-year process, he said.

"I think we'll move to the bigger airplanes, and have one or two less flights, probably, during the day," he said.

American is already flying 70-seat aircraft in other markets, Giannetti said, and they're popular with passengers because they're comfortable.

As for whether a US Airways takeover or a stand-alone American Eagle might jeopardize service to Champaign-Urbana, Giannetti said he "can't see American walking away from Willard. ... They're not going to walk away from the people flying out of Champaign."

Even if those flights were to leave, Giannetti said he doesn't think it would be hard to attract a replacement carrier.

Giannetti said Flightstar services four American Eagle aircraft per night. That includes checking the tires and oil, making basic inspections and changing engines when there's a problem.

The work also includes interior cleaning and maintenance, including seat cover and carpet changes.

Flightstar provides a range of other services at Willard, including charter air service, aircraft management and terminal and ramp services.

"I would say a third of our company is (airline and aircraft) maintenance, and 50 to 60 percent of that is American Eagle," Giannetti said, noting the rest is general aviation.

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big10bum wrote on June 03, 2012 at 4:06 pm

Bring back Ozark Airlines! I have a trip later this year to Florida, it is over $200 less to fly out of Indianapolis, I can drive their & back with a park/fly option at a hotel & still be money ahead! I would like to know what the fire department at Willard does at well? Searching for ashtray fires outside Flightstar? Penn State & U of Iowa have little to no air service, we will survive just fine. 

Sid Saltfork wrote on June 03, 2012 at 7:06 pm

American Airlines will complete it's bankruptcy by cancelling out all debts; and taking it's employees pension fund.  The federal government will assume the pension cost; and provide the pensioners with 30% of what they were receiving.  United Airlines did it in the past.  American Airlines without it's debt, and pension obligation will thrive in the smaller market.  They will continue to provide bonuses to their excutives; and an marginal gain for it's investors.  It's the American way. 

basset wrote on June 03, 2012 at 7:06 pm

Didn't you run the same story weeks ago?  What is it doing here again?

basset wrote on June 03, 2012 at 7:06 pm

I recall this story because it has the classic bad reporting lines - read these lines together from the story:

 

"Locally, few people outside American Airlines have as good a handle on American's business in and out of Willard Airport as Bill Giannetti.

"Unfortunately, we have no idea," he said."