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Published: Thursday, 4/10/2008

American Airlines cancels 1,094 flights

FROM THE BLADE'S NEWS SERVICES

DALLAS - Business trips and vacations were disrupted for tens of thousands of travelers yesterday as American Airlines canceled more than 1,000 flights - nearly half its schedule - to fix faulty wiring that could cause a short-circuit or even a fire and explosion.

The airline also canceled more than 900 flights today.

It was the latest - and largest - in a wave of cancellations at major U.S. airlines that have caused long lines at ticket counters and made flying even more stressful than usual.

Executives at American said safety was never compromised, and they suggested the nation's biggest airline was the victim of suddenly stepped-up scrutiny by federal regulators.

American estimated that more than 100,000 travelers were booked on Wednesday's 1,094 canceled flights. Many had to scramble to book new flights or were stranded far from home.

The airline had already scrubbed 460 flights on Tuesday after federal inspectors found problems with wiring work done two weeks ago, during the first set of shutdowns.

A top executive said the cancellations would be a "significant" cost to American, and shares of parent AMR Corp. fell 11.1 percent, down $1.15 to $9.17.

The issue stems from an order that the Federal Aviation Administration gave airlines in September 2006 - and gave airlines until last month to meet - about the bundling of wires in the backup power system for the fuel pump of the MD-80 airplanes. The fear is that improperly bundled wires could rub, leading to an electrical short or even fire. However, no serious incidents have been blamed on the bundles, the FAA said.

American officials thought they had fixed the problem last month. But this week, FAA inspectors found problems with the work done on more than a dozen planes. American said it had no choice but to ground all 300 of its MD-80s to deal with the wiring bundles.

American operates about 2,200 daily flights, more than one-third with MD-80s. Nearly half the cancellations were concentrated at two airports, in Dallas and Chicago.

At New York's LaGuardia Airport on Wednesday, hundreds of passengers stood in check-in lines or milled about, using cell phones to get updates on their flights. The airline offered free doughnuts, coffee, and orange juice, but there were few takers.

"They should be able to predict these kinds of things," said Laura Goodman, whose flight home to Dallas was canceled. She said would miss an important meeting because the airline couldn't rebook her until Thursday.

New Yorker Michelle Soss had hoped to steal a few days in Albuquerque, N.M.

"I covered my kids' schedules, I covered my work schedule to get away for a few days," she said. "I don't know if I'm getting anywhere."

American's cancellations came after similar delays at Southwest, Delta and United. Alaska Airlines said Wednesday it canceled 14 flights to inspect the wiring on its nine MD-80s.

For travelers, the bad news might not end Thursday either. Daniel Garton, American's executive vice president, said cancellations could extend into Friday.

A return to normal operations depends on how quickly mechanics can inspect and fix the wire bundles. Airline spokesman Tim Wagner said late Wednesday afternoon that 60 planes had been cleared to fly, 119 were being worked on, and 121 planes had not yet been inspected.

Garton acknowledged that the bundling of wires had not met FAA standards, but he said "these were not huge errors" and posed no threat to safety. He said the agency used to give airlines "latitude" in interpreting safety regulations, but no longer.

The FAA began looking more closely at airlines' compliance with safety directives in recent weeks, after it was criticized for letting Southwest operate planes that had missed inspections for cracked fuselages.

Even before the recent flight cancellations, airlines and passengers were facing a new wave of travel misery.

Record-high fuel prices and the industry's fragile finances have led to a new round of bankruptcies among smaller carriers in recent weeks, including ATA Airlines, Skybus, and Aloha Airgroup.

Bigger airlines are shrinking their fleets to cut fuel costs, even as demand for travel remains strong, meaning flights are growing ever more crowded and unpleasant.

And layoffs are beginning again for a business that, to many of its customers, is already suffering service problems. It feels that way to airline workers, too, and as the industry's decline accelerates, passengers can expect harried and grumpier gate agents and flight attendants.

Moreover, all across the air travel system in the United States, equipment - air traffic control systems, airplanes, airline computer systems - is aging and in many cases overtaxed. That means breakdowns and weather problems become more disruptive.

In the near term, airlines cannot raise fares fast enough to cover rising fuel costs. That has plunged the industry back into the red after a brief, two-year run of profits. Merrill Lynch analyst Michael Linenberg expects the industry to lose $1.9 billion this year.



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