News Update: FAA Proposes $24.2 Million Fine On American Airlines For 2008 Maintenance Lapses

The FAA is proposing a $24.2 million fine for American Airlines (NYSE:AMR) stemming from alleged maintenance lapses in 2008 that caused thousands of cancellations. The agency said that AMR failed to prevent chafing electrical wires in the wheel wells of the jets that could have led to fires and fuel explosions. However, the airline said passenger safety was never a question at any point. American, a unit of AMR Corp., cancelled 3,000 flights, which affected 300,000 travelers. Prior to this fine, the largest fine imposed on an airline was a $10.2 million fine given to Southwest Airlines (NYSE:LUV) for alleged inspection shortcomings on a number of their Boeing (NYSE:BA) 737s in 2006 and 2007. SmarTrend alerted subscribers to take profits in AMR on June 29, 2010 at $6.88, since then the stock fell 11.7%. We are now watching for any positive developments that could result in a new uptrend signal.

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News & Politics

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"TRUST OUR GUARANTEE OF INSPECTION SHORTCOMINGS--Because American Airlines (NYSE:AMR) cares even LESS for you than we could possibly imagine" --slogan from their new ad campaign