SimAirline.net - Viewpoint (Entries tagged as Bankruptcies/Shutdowns)

Mesa Denied Aloha Brand Rights

nospam@example.com (Aaron Robinson) — Sat, 06 Dec 2008 17:32:00 -0800

Mesa Air Group's plan to rebrand its Hawaiian subsidiary as Aloha Airlines was denied yesterday. The U.S. Bankruptcy Court refused to allow Yuciapa, Aloha's former controlling shareholder, to purchase Aloha's brand and license it to Mesa. Judge Lloyd King said that "Mesa and go! have been given credit for the demise of Aloha" and that letting Mesa's go! rebrand as Aloha would be disrespectful to the airline's former employees.

DayJet Closes

nospam@example.com (Aaron Robinson) — Tue, 23 Sep 2008 14:49:45 -0700

DayJet, a business jet-for-charter service that began flying last October, closed last Friday after being unable to obtain continuing financing. The company offered flights between five "Dayports," secondary airports within Florida where it had its own facilities. DayJet operated 28 Eclipse 500s seating three passengers, and had ordered 1400.

As part of its shutdown announcement in which it also said it would be unable to provide refunds, DayJet pointed to Eclipse's "failure to install missing equipment or functionality or repair agreed technical discrepancies in accordance with the terms of DayJet's aircraft purchase contract" as part of its failure.

Olympic Airlines to Close

nospam@example.com (Aaron Robinson) — Fri, 19 Sep 2008 03:58:00 -0700

Olympic Airlines will close its doors after half a century of flying and be replaced by a new entity, Pantheon Airways. Pantheon will be a private enterprise, likely with some foreign interest. It will continue Olympic's existing domestic network, but shrink its international scope.

Olympic's saga mirrors that of Alitalia, although it is less well known. Mismanagement and government interference were combated with heavy subsidies, which in later years violated EU competition policy. The airline restarted in 2003 as an Olympic Airways subsidiary was renamed Olympic Airlines and took over the parent's assets. Multiple failed privatizations eventually led to a crushing debt load and this week's shutdown decision.

Alitalia Files for Bankruptcy

nospam@example.com (Aaron Robinson) — Sat, 30 Aug 2008 10:57:00 -0700

Alitalia filed for bankruptcy yesterday after decades of financial struggles. The airline will continue operating, although its losses are now at €2 million per day. The company is proposing to split the company in two, cut thousands of jobs, and bring in a foreign airline to take over. Prime Minister Silvio Berlusconi insists that Alitalia remain in Italian hands (likely meaning a merger with Air One), a condition that led to the collapse of Air France-KLM plans to take over earlier this year.

What does this mean for Alitalia Virtual? Earlier this year I discussed our position, which has not changed: we will continue to offer Alitalia Virtual. To add on to what I said back in March though, the exact form will be decided in the future—it could be the present with Discontinued Flights, or we might opt to revert to a historical version a la Varig Virtual.

Endangered Species?

nospam@example.com (Aaron Robinson) — Fri, 11 Apr 2008 23:26:33 -0700

Frontier Airlines filed for Chapter 11 bankruptcy last night after its main credit card processor, First Data, announced it would increase its "holdback" of customer receipts, reducing Frontier's cash flow to an unsustainable rate. Frontier is continuing operations as usual but filed for bankruptcy in order to keep the existing contract in place, which was supposed to be replaced today. With numerous credit card processors' airline-derived finances in trouble after the Aloha, ATA, and Skybus shutdowns, First Data's move may have been a knee-jerk response to market concerns about Frontier's viability. Frontier however, stated as recently as Tuesday that their financial health was in good shape, and their traffic data backs this claim: just last week announced load factors 7.6 points higher than the previous year, with stronger yields as well.

Because there is no change to Frontier's operations, Frontier Virtual remains unaffected. As always, SimAirline.net is devoted to keeping Frontier Virtual open, regardless of the fate of the real airline.

This topic is being discussed on the Message Boards.

Oasis Hong Kong Runs Dry

nospam@example.com (Aaron Robinson) — Fri, 11 Apr 2008 04:08:09 -0700

Oasis Hong Kong, Asia's first longhaul low-fare airline, ceased operations on Wednesday after a year and a half of operations. The airline flew five 747-400s to London Gatwick and Vancouver, and is looking for an investor to buy the company's assets. China's Hainan Airlines, which is actively seeking to establish itself in Hong Kong, is rumored to be interested. Oasis Hong Kong CEO Steve Miller was the founder of fellow Hong Kong airline Dragonair.

This topic is being discussed on the Message Boards.

Four...and Counting

nospam@example.com (Aaron Robinson) — Sun, 06 Apr 2008 18:57:31 -0700

Skybus Airlines joined the crowd of falling airlines, closing its doors yesterday. Skybus' CEO and CFO had departed weeks earlier for various reasons. Skybus was one of the best-funded startup airlines in history, yet folded after just ten months. The airline used a Ryanair-type strategy of bare-bones flights, ultra-low fares, and ancillary revenues. Many of the A319s were leased from Virgin America. Given that airline's slower than originally planned expansion, it's unclear if the aircraft will be leased out again or enter service for Virgin.

This topic is being discussed on the Message Boards.

Falling Tails

nospam@example.com (Aaron Robinson) — Thu, 03 Apr 2008 16:31:59 -0700

First Aloha, then ATA Airlines and Champion Air. ATA, former American Trans Air, filed for Chapter 11 bankruptcy last night and ceased operations after its military contract had been withdrawn days earlier. During their 2004-2006 bankruptcy, ATA sold most of its scheduled domestic passenger operations to Southwest Airlines, focusing on flights between the West Coast and Hawaii in partnership with Southwest. The impact on ATA's sister airlines North American Airlines and World Airways, all owned by Global Aero Logistics, remains unclear.

Champion Air, a Twin Cities-based charter airline flying 727-200s, will be ending service on 31 May when all current contracts are fulfilled. Champion found itself with insufficient capital to replace its aging and fuel-intensive fleet, while its customers had been increasingly desiring newer aircraft. The airline was once partially owned by Northwest, and its main customer was Northwest subsidiary MLT Vacations.

Both ATA's and Champion's shutdowns are being discussed on the Message Boards.

Latest Victim

nospam@example.com (Aaron Robinson) — Tue, 01 Apr 2008 03:20:40 -0700

Aloha Airlines, which filed for bankruptcy just a week and a half ago, ceased passenger operations yesterday after 61 years of service. Hawaii Governor Linda Lingle asked the bankruptcy court to force Aloha to continue passenger operations for another month because of the economic disruption the loss of travel would cause, but the request was denied.

Hawaiian Airlines reportedly met with Aloha to try to save the smaller airline by using the brand to operate interisland routes, but a deal was unable to be reached. Aloha's cargo and ground services divisions are up for sale, with the former likely to be sold to Seattle-based Saltchuk Resources. For more information, The Honolulu Advertiser has numerous stories about the shutdown.

This topic is being discussed on the Message Boards.

Aloha Enters Bankruptcy

nospam@example.com (Aaron Robinson) — Fri, 21 Mar 2008 03:48:16 -0700

Has the latest shakeout in the U.S. airline industry begun? Aloha Airlines filed for Chapter 11 bankruptcy protection on Thursday, after previously being in Chapter 11 from December 2004 to February 2006. Aloha's precarious financial state over the last few years is partially due to its older interisland fleet of 737-200s, which raise the airline's exposure to rising fuel prices, but also because of "its inability to generate sufficient revenues from its inter-island passenger business due to predatory pricing by Mesa Air Group's go!"

Here's hoping that Aloha, now flying for over sixty years, can successfully restructure its business, and that Hawaiian Airlines, which was also in bankruptcy from March 2003 to June 2005, won't follow Aloha back to bankruptcy court.

Latest Pan Am Incarnation Closes

nospam@example.com (Aaron Robinson) — Mon, 03 Mar 2008 16:44:55 -0800

The most recent airline to operate using the Pan Am name, Boston-Maine Airways operating as Pan Am Clipper Connection, ceased operations on 29 February after the Department of Transportation concluded that the carrier's certificate should be revoked because of poor financial fitness, questionable management competence, and unwillingness to follow federal laws, rules, and regulations. The airline flew 727s and Jetstream 31s primarily within the Northeast U.S., and was the fourth airline incarnation of the Pan Am brand.

The company was owned by Guilford Transportation Industries, which bought the Pan Am brand in 1998 and, sadly, still uses it in the form of Pan Am Railways. The Portsmouth Herald has a good article on some of the background of the airline's grounding.

Does the name Boston-Maine Airways sound familiar? It should. The original Boston-Maine Airways was founded as a Pan Am contract carrier, flying for them from 1931 to 1933. It later evolved into Northeast Airlines, which was bought by Delta Air Lines in 1972. Of course, Delta later bought Pan Am.

Big Sky Airlines Shutting Down

nospam@example.com (Aaron Robinson) — Tue, 26 Feb 2008 23:46:19 -0800

Onetime Northwest Airlink and Delta Connection affiliate Big Sky Airlines will close its doors on 8 March after just under thirty years of service. Billings-based Big Sky flew primarily within Montana throughout its history under Essential Air Service (EAS) contracts.

The airline was a Northwest Airlink partner in the first half of its existence, but spent most of the last twenty years as an independent airline, but with codeshare partnerships with other airlines, including Northwest. Big Sky's Montana operations were once offered at Northwest Virtual because Big Sky is a subsidiary of MAIR Holdings, which was part-owned by Northwest Airlines at the time. As part of Northwest's bankruptcy restructuring, Northwest gave up its stake in MAIR in exchange for Northwest Airlink partner Mesaba Airlines, MAIR's other subsidiary.

With MAIR's primary moneymaker gone, Big Sky began feeling the pain. During 2007 it flew under the Delta Connection banner out of Boston, but these routes were dropped. Big Sky was also contracted to cover the routes of Ft. Lauderdale-based Chalk's Ocean Airways, whose flights to the Bahamas were disrupted due to the grounding of its Grumman Mallard fleet after a 2005 crash. But its operating certificate was revoked in September, forcing the company to close.

Big Sky's employees tried to buy the company from its owners and run it, but the airline's assets were worth more than the company as a whole, leading to the liquidation decision. A similar company, Cheyenne-based Great Lakes Airlines, is expected to pick up Big Sky's routes.