Gerard Arpey

Our Fly Smart philosophy is about investing only on those points of differentiation that pay for themselves, that earn a revenue premium commensurate with what it costs us to provide that product or service.

The executive moves we are announcing today will strengthen American for the long-term future and reflect well on the depth of the Company's management team.

Just to cover the increase in fuel costs over the past two years, American would have had to raise fares nearly $75 per round-trip ticket. During this time period, our average fare increased by only $15.

But I definitely see us playing a major role in St. Louis in the years to come. We already provide service to 95 percent of the markets St. Louis travelers visit the most. And we're adding capacity in some of the most important markets.

Our planes should be full, which among other things means we have a golden opportunity... to build on the momentum reflected in the financial results we are reporting today.

We have, unlike many of our competitors, continued to meet our various financial obligations.

At American Airlines, we have built a business around the love of travel that has lasted three quarters of a century. And I'm pretty sure we're just getting started.

Second, we have to make the most of the strengths we have, the amenities that many of our competitors cannot replicate. But again, those advantages won't mean much if we don't do a great job with the basics of our business.

Despite the painful changes we have had to make, we continue to believe in the St. Louis market. And we are hoping to add flights, in a careful way, as the economics of our business improve and the demands of the traveling public in St. Louis become clear.

I think in just about any business the low cost competitor is always going to have an advantage.

However, the economics of our business continued to deteriorate. We barely escaped bankruptcy a year ago, and in the aftermath of that escape we had to make some even tougher decisions.

We continued the hard work of integrating TWA, because at that time we still thought an efficient connecting hub in St. Louis could be a profitable addition to our network.