American Airlines parent AMR Corp. failed to reach a labor agreement with its pilots over the weekend, pushing down its stock price and briefly triggering a halt in trading Monday.
AMR shares fell 21 cents, or 7 percent, to $2.73 in midday trading. They dropped as much as 11 percent to $3.04 earlier in the day.
The company and the Allied Pilots Association said Friday they would meet through the weekend, raising expectations for a deal. By Sunday night, however, those hopes were dashed.
American has fallen behind as other airlines benefited from a recovery in air travel and higher fares.
AMR, which hasn't earned a full-year profit since 2007, has blamed its problems largely on high labor costs, and it wants pilots to accept contract terms that will boost productivity and cover a shortage of pilots caused by a wave of recent retirements.
AMR spokeswoman Missy Cousino said Monday that there was "significant progress" in the talks and "there is a path to an agreement." She said talks would resume by midweek, after union negotiators brief their board on Tuesday.
Pilots want pay increases to make up for concessions they granted in 2003.
Union spokesman Sam Mayer said pilots were willing to help the company deal with temporary crew shortages. But, he added, "Unless you see some pretty significant pay raises, whatever (the union sends) to the membership has zero chance of ratification."
Ray Neidl, an airline analyst with Maxim Group LLC, said AMR shares appeared to be falling because of the lack of a deal with pilots.
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