How American Airlines Rose From Bankruptcy to S&P 500
2011 was a difficult year for American Airlines. After taking a substantial hit in the recent Great Recession, the airline filed for bankruptcy in 2011, seeing no way to overcome the financial pit that it found itself in. Here in March of 2015, it is hard to believe that American spent the past several years embroiled in court cases related to its financial instability.
As of close of market this Friday, American Airlines is set to be accepted into the presitigious S&P 500 – the list of the top 500 most profitable corporations on the market today. How did American pull off such a tremendous recovery amidst such uncertain market conditions?
Ultimately, American’s recent success is due two different factors. Firstly, the company consolidated its flights in order to bring prices down – a move completed when America merged with US Airways in order to create the largest airline in the world. Secondly, the merger occured at the same time that incredible growth was seen in the airlines industry, as records for ticket sales were broken for both domestic and international ticket sales.
With both factors occuring together, it is no wonder that American has found itself in such a healthy market position today.