AMR Corporation filed for Chapter 11 bankruptcy protection on November 29, 2011, and American announced capacity cuts in July 2012 due to the grounding of several aircraft associated with its bankruptcy and lack of pilots due to retirements. American's regional airline, American Eagle, was to retire 35 to 40 regional jets as well as its Saab turboprop fleet. American ceased its service to Delhi, India in March 2012.
By summer 2012, American was considering merging with another airline as part of its restructuring plan. AMR was reportedly considering merger proposals involving US Airways, JetBlue, Alaska Airlines, Frontier Airlines, and Virgin America.In a July 12 court filing, US Airways said it supported an American Airlines request to extend a period during which only American could file a bankruptcy reorganization plan ("exclusivity period"); in the filing US Airways disclosed that it was an American Airlines creditor and prospective merger partner. On August 31, 2012, US Airways CEO Doug Parker announced that American Airlines and US Airways had signed a nondisclosure agreement, in which the airlines would discuss their financials and a possible merger.
American notified more than 11,000 workers of possible job loss as part of its bankruptcy reorganization, and cut flights by one to two percent in September and October 2012. In October, the airline announced plans to hire 2,500 pilots over two years to staff new international and domestic routes, with about 1,500 of the new hires replacing retiring pilots or jobs that open up due to attrition. The Allied Pilots Association, representing pilots of American Airlines, voted in December 2012 to ratify a tentative agreement between the company and the union.