Midway airlines folded today and fired all remaining staff.
Managment said in view of the further downturn that current events were sure to bring on there was no point in operating jets and ceased operating immediately to preserve capital for the creditors to be repaid.
Wino
OldAg84
12th Sep 2001, 21:59
Having flown Midway just week, 1700 people out of work - I am saddened-on top the great tragedy still unfolding in New York.
Doodles
13th Sep 2001, 11:45
Difficult to think of finances and jobs with the images we have all seen and events that are still unfolding...however....
IATA have called an emergency meeting next week to discuss the financial impacts of the current situation. "..with estimates of $2.8 billion losses this year.." before this weeks events the clear effect on the global transportaion industry is frightening. It seems as if Midway may be amonth the first of a few.
newswatcher
13th Sep 2001, 14:58
From AP:
@Midway Airlines was already been riddled with financial problems and bankruptcy proceedings when terrorists struck the nation this week, dashing any hope for a recovery at the troubled carrier.
Midway said Wednesday it will go out of business in the midst of the hijackings that led to crashes at the Pentagon and World Trade Center. The decision sent 1,700 employees to the unemployment lines, joining the 700 laid off when the airline filed for Chapter 11 bankruptcy Aug. 13.
"It just became clear as we went through the day yesterday that people weren't booking air travel," Midway spokeswoman Karen Wing said. "The calls just stopped in the travel center for reservations and the people who did call wanted a refund because they didn't want to be on an airplane for a little while."
The North Carolina-based airline, which had won a bankruptcy judge's permission keep operating, said last week that business was looking up, with the company borrowing less than expected in its reorganization effort.
John Bittle, former director of systems support, had worked last weekend putting together cost-cutting measures to keep Midway's planes in the air.
"We really had a plan to turn it around," said Bittle. But, "After yesterday, there wasn't a lot of hope."
Airport spokeswoman Teresa Damiano said officials expect demand for air travel in the Raleigh area will lead other carriers to pick up many of Midway's former routes - once people are comfortable with flying again.
At the time it declared bankruptcy, Midway served 28 destinations across the country with 74 aircraft. It had immediately cut nine destinations and planned to limit service on others.
Wing said workers were sent home immediately from the company's headquarters. About 100 employees will remain for a couple of weeks to shut down the company, some of them to arrange refunds for ticketholders or book them onto other airlines.
Midway said it would begin returning aircraft to their lessors and would try to sell other assets to help pay its debts.
"There's still money in the bank at this point. This is more of a future-looking thing," Wing said. "We really need to protect our employees and pay them their last wages, and do the right thing for our passengers."
The airline has blamed its financial problems on a sudden fall in business travel and increased competition. The airline also had purchased new airplanes and expanded its routes.
In its bankruptcy filing, Midway listed assets of $318 million and liabilities of $232 million. The company posted losses of $15 million in 2000 and another $15 million in the first six months of this year.
The judge's order to keep Midway in operation allowed it to borrow as much as $15 million and pay some 700 employees who had already been laid off. Wing said $7 million of that had been spent as of Wednesday.
Midway had targeted business travelers since moving here from Chicago in 1995 to pick up flights dropped by American Airlines when it dismantled its hub at the Raleigh airport. But ticket sales plummeted along with the economy.@