A discussion about the airline industry, airline employees, and all things related

The No. 1 U.S. airline seeks to return to profitability by cutting costs everywhere possible, Arpey told reporters at an annual shareholders meeting in Fort Worth, Texas.

"Our challenge is to continue to make improvements to drive the company to profitability," he said during a press conference made available via teleconference. "We're going to stay on that path and continue working on it until we get to that point."

American, which lost $92 million in the first quarter, has said it needs to cut costs by more than $1 billion to keep its expenses in line with 2005 levels. The airline currently has a plan to trim costs by $700 million a year.

Arpey said this need for more cost cuts stems from the record high fuel prices that have dogged the industry lately.

The carrier aims to consume fuel more efficiently and streamline all operations to improve productivity. American said on Tuesday it hopes to cut its fuel consumption by some 30 million gallons in 2006.

Arpey said other carriers that have restructured in bankruptcy have had an advantage over American. Those airlines have had court protection to slash all costs, including labor costs. United Airlines, for example, exited bankruptcy in February after slashing costs by $7 billion a year.

"Because of what other airlines have accomplished in the bankruptcy court, we have to make cost improvements and productivity improvements a way of life in this company," he said.

Washington Post