From NY Times: American Airlines Struggles as Rivals Merge

American is one of only three major carriers that have never filed for bankruptcy, along with Southwest Airlines and Alaska Airlines. As a result, the company is hobbled with much higher costs than its competitors, most of which have used bankruptcy proceedings to rewrite their labor contracts and airplane leases, terminate pensions and health benefits, and restructure their debt. If it had contracts similar to Delta’s or Continental’s, the company estimates its expenses would be $600 million lower each year.

In other words, the airline is in trouble because it has *not* gone through bankruptcy (to break contracts and turn debt to equity).