American Airlines Group Inc.’s stock saw an increase on Monday following the approval of a new contract by the airline’s pilots. The Allied Pilots Association, representing 15,000 American Airlines pilots, announced that 72.7% of the pilots voted in favor of the new agreement, with over 95% of eligible pilots participating in the vote.
Enhanced Benefits and Compensation
According to the union, the new four-year contract provides pilots with significant benefits and improvements to their compensation. Pilots will receive approximately $1.1 billion in immediate payments and ratification bonuses. The contract also includes annual pay rate increases throughout its duration, as well as enhancements to various benefits and work rules.
Increased Funding and Pay Raises
The union stated that the new contract secures over $9.6 billion in additional funding compared to the previous agreement. On average, pilots can expect a pay raise of more than 21%. When combined with the pay increases, total compensation could rise by more than 46% over the four-year period of the contract.
Positive Stock Performance
Following the announcement, American Airlines shares experienced a 0.7% increase in value. This turnaround comes after the stock had initially been down by as much as 0.6% prior to the report. The S&P 500 index, which serves as a general indicator of the market’s performance, also showed a 0.7% increase during recent trading activity.