And you think you're trying to save gas ...

Everyone at American has been told to keep the Fuel Smart principles in mind. Some veteran pilots have had to be convinced, said Turner. American makes sure its aircraft carry extra fuel in case flight time gets extended due to a course change or air traffic congestion. But Turner, an active American pilot himself, wants pilots to change the way they look at that extra fuel.

“In the past, we said, ‘I want 15,000 pounds when I get to my destination,'" he said. “Now we say, ‘Let's do that in minutes. How many minutes of fuel do you want when you get there?’ And typically, when you convert the minutes to gallons, pilots are willing to arrive with less. It's just this whole cultural shift that we've gone through.”

But, in the end, all of these efforts may not be enough. The 96 million gallons the program saved in 2007 reduced fuel cost by less than 4 percent. With more than 2,000 flights a day, the price of oil is sucking away any glimmer of a profit. As a result, airline executives are reconsidering their business model.

“It certainly takes a lot of your attention and makes you think, ‘How are we going to get through this?’" said Dan Garton, American’s executive vice president of marketing.

Garton believes the solution is easy to state but hard to bring about.

“We have to raise our revenues equal to what fuel has gone up,” he explains. “So in some fashion, whether it is prices or fees or customer mix, we have to increase our revenues in the neighborhood of $3 billion to $3.5 billion to offset the $3 billion to $3.5 billion of fuel cost increase. Plain and simple.”

American’s strategy is to drop flights and routes that aren’t profitable.

The theory is right out of Adam Smith: Cut the supply of seats, and demand for the remaining seats should rise, driving up overall revenues. American already has cut flights at several major airports like Chicago’s O’Hare and New York’s LaGuardia. It’s completely shutting down service to smaller cities like Albany, N.Y., Providence, R.I. and Harrisburg, Pa. By year’s end the airline will have cut capacity by up to 12 percent, similar to cuts by other major domestic carriers.

With fewer flights, fewer employees will be needed. Early this month, American announced that about 7,000 workers — roughly 8 percent of its more than 85,000 employees — will lose their jobs this year. And fewer aircraft will be needed too, meaning that 100 of the least fuel-efficient planes will be retired.

Garton admits that some current flyers simply will not be able to fly.

“It’s an unfortunate part of this because our country has gotten accustomed to being able to fly somewhere for the weekend," he said. "Everybody can go see Aunt Millie for her birthday, and some of that may change for some of our customers. Seventy-eight percent of our customers fly once a year. And so some of those people may not be able to fly anymore, because we will raise our prices by hook or by crook.”

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