AMR's American Airlines will eliminate as many as 900 flight attendant jobs as the world's largest carrier begins grounding planes and cutting flights to combat record fuel prices. American told the Association of Professional Flight Attendants on Wednesday of plans to furlough the employees effective Aug. 31, the union told members on its Web site. The carrier and the union have reached an agreement to offer leaves and early retirement to eligible attendants to help reduce furloughs.

The attendants are the first unionized group of workers to be notified of pending layoffs as Fort Worth, Texas-based American prepares to cut domestic capacity 12 percent in the fourth quarter. The airline and other major U.S. carriers have already said they'll pare at least 11,850 jobs and ground 413 aircraft as fuel costs, their biggest expense, erode profits.

"These are difficult but necessary changes given the unprecedented challenges we face with overcapacity in the industry, skyrocketing fuel prices and a worsening U.S. economy," said Tim Wagner, an American spokesman.

American has not yet determined the number of pilots or other workers that may face furloughs, he said. The company earlier said it would cut 8 percent of management and staff jobs, without providing a number.