American Airlines 1998 Annual Report Download - page 11

Download and view the complete annual report

Please find page 11 of the 1998 American Airlines annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 66

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66

In addition to the strong revenue performance, American benefited on
the cost side of the ledger from the low price of fuel. After labor, fuel is the
airline’s largest expense, and lower prices shaved more than $300 million off
the company’s fuel bill for the year.
AMR’s regional carrier, American Eagle, performed well in 1998.
Driven in part by the introduction of regional jet service in several key markets,
passenger traffic increased by 9.2 percent, and generated revenues 10.2 percent higher than 1997.
The airline business has traditionally been a very cyclical business, highly impacted by the economies
of the markets it serves. As this annual report goes to press, it is unclear whether the U.S. economy in 1999
will grow at a pace comparable to 1997 and 1998. However, while American’s fortunes in 1999 will be tied
9