American Airlines president Robert Isom publicly admitted the trouble facing his company, saying he and others in leadership are "taking decisive action" to turn things around.
American Airlines stock is down around 14 percent since September 2018. Nearly 1,000 flights have been canceled this summer, and it ranks seventh on the list of airlines with the best on-time arrival percentage in the U.S., according to January to June data from the Department of Transportation.
“The point that I want to make is that 2019 should have been much better for American," Isom said Wednesday at Cowen and Company's Global Transportation Conference.
|AAL||AMERICAN AIRLINES GROUP, INC.||22.03||-0.10||-0.45%|
Isom blamed "illegal labor union action" and the grounding of Boeing's 737 MAX airliner. American claims two airplane mechanic unions have been purposely doing their jobs slower as part of a gambit to get the upper hand in a lengthy contract dispute. The labor dispute has "had a significant impact on the operation," he acknowledged.
"So we’re behind," Isom admitted. "We’re not as far along as we had wanted. We certainly haven’t produced the kind of margins and earnings that we had hoped. But the point I want to make is there are no excuses. It is our job to get our arms around this."
"We are taking decisive action," he continued. "And we will strengthen the business. And we are confident in delivering value for our shareholders long into the future.”