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American Airlines -- AMR Corp (NYSE: AMR) -- is once again canceling massive amounts of flights in order to inspect the bundling of wires in some of its airplanes. You may recall, that this is the same situation that led to around 400 cancellations last month, and this current inspection is estimated to affect even more flights, with up to 500 flights being canceled.The current round of cancellations, which represents about 20% of total American flights, started late Tuesday afternoon, and was expected to last Tuesday night and into Wednesday, and possibly even beyond.
Passengers that were scheduled to fly the canceled American flights have been switched over to alternative American flights, or placed on other airlines that service the selected routes.
The wiring bundles are apparently not flight-safety issues, and revolve around bundles of wires in the planes' auxiliary hydraulic systems. According to the FAA, which inspected some American planes on Monday, the work that that was done on the planes last month just did not meet the FAA's level of standards, so the massive inspection will continue once again.
It's been a tough few weeks for the airline industry. The news has been flooded lately with reports of massive flight cancellations, and several airlines going bankrupt and shutting down operations all together.
American's parent company, AMR Corp, is scheduled to report its earnings on the 14th of this month, and analysts are expecting to see the company post a loss in its first quarter of $1.32 a share.
Michael Fowlkes has worked as a stock trader for seven years and spent the last four years working as an analyst for the online investment advisory service Investor's Observer.
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