October 10, 2011 / 11:15 PM / 7 years ago

American Airlines capacity to dip in fourth quarter

An American Airlines Boeing 737 and a Boeing 787 sit side by side at DFW International Airport as officials of AMR, American Airlines, Boeing and Airbus announce a major airplane manufacturing deal during a news conference at DFW International Airport in Dallas, Texas July 20, 2011. REUTERS/Darrell Byers

(Reuters) - American Airlines, a unit of AMR Corp AMR.N, said fourth-quarter mainline capacity will dip 3 percent due to an adjustment in its schedules and that it will retire up to 11 Boeing 757 aircraft in 2012 in response to high fuel costs and an uncertain economy.

Earlier this year the airline, the third-largest U.S. carrier, placed an order for 460 single-aisle jets worth up to $40 billion. American split the order between Boeing Co (BA.N) and its European rival, Airbus EAD.PA, breaking off an exclusive relationship with Boeing.

The company’s chief commercial officer, Virasb Vahidi, said the reductions were aimed at ensuring a reliable schedule for customers given anticipated pilot retirements in the fourth-quarter.

American Airlines is being touted as the most likely big U.S. airline to go bankrupt, but the sum of its hardships — high labor costs and weak cash flow — are not expected to result in an imminent Chapter 11 filing.

The company said it expects full-year mainline capacity to rise by 0.4 percent, from a year ago, and consolidated capacity to rise by about 1.2 percent.

Reporting by Swetha Gopinath in Bangalore; Editing by Steve Orlofsky

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