Isom signals further changes as it deals with high jet fuel costs
American reorganizes commercial, operational leadership
Pilots question management’s ability to close profit gap

By Rajesh Kumar Singh

CHICAGO, Aug 12 (Reuters) - American Airlines (AAL.O) is reorganizing senior management, broadening oversight across its commercial and operations teams and adding a former Spirit Airlines executive to run technical operations, as CEO Robert Isom faces pressure to close the carrier’s profit gap with rivals.

In a staff memo seen by Reuters, Isom acknowledged a “meaningful gap” between American’s current performance and where he said the airline should be. He said the moves were the “first step in a series of actions” aimed at strengthening the team, improving alignment and accelerating execution.

The company’s profit gap with Delta Air Lines (DAL.N) and United Airlines (UAL.O) was already wide before the recent fuel shock that followed the U.S.-Israeli attacks on Iran that kicked off a war that has caused energy prices to surge.

Former Spirit Airlines COO John Bendoraitis will join American to lead technical operations, one of a number of moves to try to boost performance. Chief Commercial Officer Nat Pieper will add marketing and branding to his duties, Chief Customer Officer Heather Garboden will take on reservations and service recovery, and JC Gulbranson will add airports and planning.

Chief Communications Officer Ron DeFeo is stepping down, according to the memo. Caroline Clayton will oversee communications and Steve Neuman government affairs.

Garboden, Gulbranson, Clayton and Neuman will join American’s senior leadership team. American expects roughly break-even results in 2026, as higher jet fuel prices ate up gains from stronger revenue. Delta and United expect solid profits. The heat on Isom has already been building. Flight attendants earlier this year called for a leadership change, while its pilot union has questioned whether the current management team can close the earnings gap.

Pilots’ union head Nick Silva recently contrasted American’s breakeven outlook with profits at rivals, arguing that “rising fuel costs are not holding our competitors back from innovation and profitability.”

In a memo to pilots last week, Silva said the union had sought a meeting with American’s board to discuss concerns about the company’s future but was “rebuffed.” It has since held discussions with analysts, investors and other stakeholders, he said.

“The consensus is clear: Something must change. The only question is ‘When?’” Silva wrote. Isom made clear he is not changing course, saying American has “the right strategy and the right team to deliver it,” as it focuses on expanding its global network, growing premium revenue and strengthening its AAdvantage loyalty program.