Who Is Gerard J. Arpey?
Gerard J. Arpey is a partner with Emerald Creek Group LLC, a private equity firm. He was the CEO of AMR Corporation and American Airlines from 2003 to 2011 and the chairman of the board of directors from 2004 to 2011. Before rising to CEO, he was president and chief operating officer, senior vice president of finance and planning, and chief financial officer. He joined American Airlines in 1982 as a financial analyst and was named a corporate officer in 1989. He resigned from AMR Corporation after it declared bankruptcy.
- Gerard Arpey joined American Airlines as a financial analyst after graduating from business school in 1982.
- Arpey rose through the ranks to become CFO of AMR Corp. and American Airlines in 2000 and ultimately CEO in 2003.
- The period after the terrorist attacks of Sept. 11, 2001, was difficult for the airline industry; Arpey navigated American through a rough period, gaining credit from employees and the larger business community.
- Arpey left AMR in 2011 rather than take the company through bankruptcy. Arpey now works at the private equity firm Emerald Creek Group.
Gerard J. Arpey Biography and Career
Gerard J. Arpey was born in 1958 in New York City. He earned a Bachelor of Business Administration degree in 1980 and a Master of Business Administration in 1982, both from the University of Texas at Austin. He is also a private pilot with an FAA Multi-Engine Instrument Rating and a certified flight instructor.
Arpey joined American Airlines in 1982 as a financial analyst, a position he only stayed in for a year. From 1983 through the end of the decade, Arpey rose to the level of director of financial analysis and planning. In the 1990s he was promoted to senior leadership, starting as the vice president of financial analysis and planning. Mid-decade he was made chief financial officer. In the 2000s, he took over operations as the chief operating officer, and in 2003, he became president and chief executive officer.
The terror attacks of Sept. 11, 2001 had a dramatic and negative impact on the airline industry generally, but while AMR's competitors, including Delta Air Lines Inc., Northwest Airlines Corp., US Airways Group Inc. and UAL Corp, went into bankruptcy to reduce their debt obligations and slim down their labor forces, Arpey refused to do so, putting AMR at a cost disadvantage estimated to be $800 million per year.
In addition to the unexpected shock of 9/11, AMR also suffered from missteps dating from before the attacks. In April 2001, Donald Carty, the CEO before Arpey, had spent a large sum to buy Trans World Airlines Inc., the former industry leader created by the legendary Howard Hughes that had fallen on hard times. In 2002, Carty asked employees to take substantial pay and benefits cuts to help the company avoid bankruptcy, but secretly he arranged for top executives, including himself and Arpey, to be awarded large retention bonuses and pension deals. When Carty's deal came to light it led to a revolt by the unions and his termination; consequently, Arpey was asked to take the top job.
Arpey made negotiations with the union and employees more transparent and worked hard to improve trust and company culture over the next eight years. He also shifted company strategy away from domestic flights and smaller airports to focus on major American cities like Dallas-Fort Worth, Miami, and large markets like Chicago and New York.
His refusal to take the company into bankruptcy was not viewed kindly by stock market and industry analysts, and though he was highly regarded at AMR, when market forces conspired to make the company announce it would finally file for bankruptcy on Nov. 23, 2011, Arpey took the occasion to retire from the company.
After leaving AMR, Arpey joined former Continental Airlines CEO Larry Kellner's private equity fund Emerald Creek Group in 2011. He also became the vice-chairman of the board of directors of S. C. Johnson & Son Inc., a trustee of the American Beacon Funds, and a member the board of directors of The Home Depot.