Amerijet Files for Chapter 11

[The Guvnor]

From atwonline.com:

Amerijet International, a small Fort Lauderdale-based cargo airline, filed for Chapter 11 bankruptcy reorganization yesterday, citing among other things the loss of a contract to supply Emery Worldwide with lift that idled six 727Fs--half its fleet--last Jan. Amerijet said it intends to continue operating its "core cargo business" consisting of scheduled and charter service to the Caribbean and Latin America as it works out a financial restructuring. Last Friday it laid off 22 employees but said it is not planning additional cuts to its workforce of nearly 400. Amerijet provided lift to Emery in support of the latter's contract with the US Postal Service under an agreement that produced around 25% of annual revenues. However, FedEx took over Emery's USPS business this year.

[TowerDog]

There goes another one.

Pretty rough times for aviation in general and freight in particular these days.

Midway just filed chapter 11 a week ago or so.

More pilots on the street soon.....Not good.
The price could start dropping.

[GlueBall]

Apparently AmeriJet had put too many eggs into one basket. Committing 50% of its equipment to Emery's postal circuit was overexposure. Comfortable ACMI operations made management lazy.

[Huck]

Nobody could have predicted that all US postal flying was going to a sole source contract, with no competitive bids. Many companies were blindsided by this bombshell.

[Vsf]

C'mon...when is this going to turn around? Or is it? Amerijet looks to be yet another nail in the cargo coffin. Not too many years ago cargo was said (by some) to be more "stable." Hmm.

I hope it bottoms out soon. The streets in Florida are flooded with 727 pilots looking for work...with nowhere to go. This reminds me of 1989 when the U.S. economy went sour. Pilots with 3,000 hours couldn't even land CFI jobs. I don't want to see those days again...once was enough! Nay, MORE than enough!

[411A]

There are a very few that are hiring, start-ups mostly, like us (soon, we hope).

[ 26 August 2001: Message edited by: 411A ]

[ironbutt57]

you gonna give me a job 411-a...think i deserve it being the second-most hated person on pprune...after you of course ;) ;) ;) :p

[raitfaiter]

Actually I think you may be a little too forthright for 411a IB57 old chap....given his postings on what he expects from his employees, and given your postings over the years it would hardly seem a match made in heaven. Unless of course 'ironbutt' indicates a certain anal resilience that may be needed by 411a's crewmembers..... :D :p :D

[ironbutt57]

got to have at least one pilot to keep him miserable ;) ;) ;)

[FreighterJock]

Calm down guys...Remember that when there's an end (of an airline) there's a new beginnig(a Start Up airline)... ;)

[411A]

Think i'll pass Ironbutt, I have enough problems already! The CEO wants an exec jet and offices in HNL, but as yours truly has the say, there will be no exec jet (turbo-prop maybe) and no fancy offices, just plain-jane accomodations. After all, we have to have SOMETHING left for crew salaries.

[The Guvnor]

Gotta say I admire your balls for starting up in the middle of a global recession, 411A - and in cargo, yet!! I've put my own plans on hold until at least 2003 now and won't hesitate to delay further if things still look bleak this time next year.

As for your CEO ...!! We're working in a 'virtual' environment and will retain that approach - no real fixed infrastructure, which saves us around US$10k/pa per employee. And as for corporate jets... :rolleyes: :eek: :rolleyes:

[411A]

You're right Guv about the need to keep things lean, and the only infrastructure we need are an office in a hotel suite (same hotel used for crew) and storage at the airport for a spare QEC engine and avionics spares. The exec jet was to be used for the major investors, but they have been told that J class on UAL is just fine, and surprisingly they agree. :eek:

[GlueBall]

And if you want to keep it really lean you could just put your name up and contract the work out to hungry cargo airlines.
Just what CNF had done a long time ago and is now doing again. After the forced grounding of its Emery unit at Dayton, the big boys in California discovered that more freight is now being moved with contractors Ryan Air, Express Net, Gemini, Arrow, Kitty Hawk...among others.

Ever see a big boss sitting behind an empty desk? It's because his company is so well organized that nothing ever reaches his desk.

[The Guvnor]

GlueBall - you've discovered my secret how I can spend so much time on PPRuNe! :D :D :D

[ironbutt57]

Just what we need 411a...another comedian...

[411A]

Yes GlueBall, it sure is working for CNF, so well in fact that I wonder if it will not go on indefinately.
The forwarders that we are working with have tried this before, only to discover that, due to the nature of the freight, aircraft reliability has been a very big problem so they are looking for a permanent solution. We have offered them one, and it looks like it will work to everyones' satisfaction. Also, we are not neglecting the pax side of the business either, that will come just a bit later. Or, maybe sooner, depending.

[GlueBall]

411A:
Aircraft reliability and contractor dependability under the present CNF arrangement at Dayton does not appear to be a problem. Perhaps because of the recession and excess freighter capacity. But the key ingredient for long term subservice success is to built ACMI arrangements with as many subcontractors as possible, rather than to make an exclusive contract with a single carrier.

Instead of rebuilding its in-house airline unit, CNF is getting cheaper, more dependable services from a multitude of contractors who are outbidding each other for choice Emery routes.
:cool: