Believe it or not, American Airlines is celebrating its 80th birthday this year. Considering the changes that have taken place, as well as the many airlines that have come and gone since 1926, reaching the big 8-0 is no small accomplishment. Our longevity is primarily a function of our company’s ability to rise to an endless list of challenges — and, as I’m sure you know, one of the biggest challenges all of us face these days is the price of fuel. While we are all feeling pain at the pump, as the world’s largest airline — and a consumer of 2.9 billion gallons of fuel last year alone — I daresay our pain has been particularly acute. During the second quarter of this year, 29 cents of every dollar of revenue we generated went to pay for fuel, compared with 15 cents in 2003 and a mere nine cents in 1998. The good news is, though the price of fuel is largely out of our control, it is possible to reduce the amount of fuel we burn without compromising safety or service. Under the auspices of a wide-ranging program we call Fuel Smart, the American team is continually discovering new ways to do just that.
As you’d expect, the amount of fuel an airplane needs has a lot to do with its weight. We’ve been working hard to identify and eliminate items that make our aircraft heavier but don’t add to the customer experience. As we manage our weight, we’re also conserving fuel through improved engine and aerodynamic performance. We’re installing winglets — upward extensions of the wings, which increase lift, thus increasing fuel economy — on all of our 737 and 757 aircraft, while more special drag-resistant tail cones, fabricated and installed at our Tulsa maintenance base, will boost the performance of our MD-80 fleet.
The imperative to conserve fuel is changing the way we do things on the ground and in the air. One very effective ground-based initiative is single-engine taxi, which means using only one engine to taxi the aircraft to and from the runways and not starting the second engine until it’s needed for takeoff. Listen carefully after landing and you may hear one of the engines shutting down. On the ramp, we’ll soon be using high-speed tractors to shuttle planes between gates and hangars, replacing the much more fuel-intensive practice of taxiing the aircraft between those locations. In the air, we’re using sophisticated algorithms written by AA operations engineers to more accurately analyze wind patterns, enabling our pilots to save fuel by flying at the perfect altitude and speed, leveraging tailwinds and avoiding headwinds when possible. We’re also counting on our customers to help. At many of our stations, flight attendants may ask you to pull down your window shade, allowing us to use less fuel while keeping the aircraft comfortable for the folks on the next flight.
These and the many other fuel-saving initiatives I don’t have room to describe will reduce our fuel consumption by more than 100 million gallons this year compared with 2004. That’s a great start, but with prices still soaring, it’s clear that we need to keep finding new ways to conserve. While we don’t expect relief from high fuel prices anytime soon, the progress we have made underscores the fact that the real fuel propelling American Airlines is the spirit, initiative, and imagination of our people. That was true 80 years ago, and it’s even truer today. On behalf of our whole team, thank you for flying with us today. Have a great trip!
GERARD J. ARPEY
Chairman & CEO