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Aloha Airlines files for Chapter 11 bankruptcy
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Getter
Throbbing Member
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Posted on: Saturday, January 22, 2005
New Aloha could emerge by fall
By Dan Nakaso
Advertiser Staff Writer
Aloha Airlines has been under federal bankruptcy protection only since Dec. 30, but the company's new president and chief executive officer already hopes to have Aloha out of bankruptcy by fall.
David Banmiller, the new chief executive of Aloha Airlines, will rely on "the chemistry of communication" and a positive attitude to help the airline emerge from bankruptcy stronger than ever.
Jeff Widener • The Honolulu Advertiser
It will be a much different company then, David Banmiller said in an interview yesterday in the company's Restaurant Row offices.
Aloha Airgroup Inc., the parent company of Aloha Airlines, still would be privately run by family members of the late Hung Wo Ching and businessman Sheridan Ing, Banmiller said. But potential new investors are likely to alter the family stake in the company.
"I think there will be a change in the dynamics of the ownership structure," Banmiller said. "Everybody that we're talking to wants the family to stay in. They're pillars of the community. The only question is how will the ownership percentage dynamic change."
Both managers and union employees also likely will be earning less and saving the company money through other cost-cutting concessions.
The employee changes are just one part of $60 million worth of savings that Banmiller has targeted.
But when Aloha does emerge from bankruptcy, Banmiller expects it will be financially strong and perhaps even enjoy a string of profitable months of operation.
"We're actually in a fairly uncomplicated situation," said Banmiller, 60, who took over Aloha on Nov. 14 after coming from Air Jamaica. "We have a plan and we know we can turn it around economically."
Banmiller has crammed a lot of changes in the two months he's been at Aloha, which had four straight quarterly losses, including a $6 million loss in the third quarter.
On Dec. 2, the company announced the cancellation of its money-losing, twice-weekly flights to the Marshall Islands and to American Samoa. A week later, Aloha eliminated 12 top management positions and froze 35 additional open positions.
Yesterday morning, Banmiller finalized arrangements to add two new daily flights between Orange County and Hawai'i, and a new San Diego-to-Honolulu route.
Then he was off to a meeting with union shop stewards representing Aloha's machinists, part of his efforts to win further concessions from Aloha's five unions.
A tentative agreement with Aloha's pilots seemed imminent earlier in the week. Although the major issues have been settled with the pilots, Banmiller would not detail the cause of the delay.
"We're asking for a lot and it takes time," he said. "We're dealing with five unions in 45 days. It's an incredible task and nobody wants to make a mistake."
Banmiller said, "I believe in the chemistry of communication."
And one of his messages is that Aloha should emerge from bankruptcy quicker than Hawaiian Airlines, which has been in bankruptcy since March 2003.
Hawaiian's bankruptcy reorganization was delayed, in part, by the bitter court fight over the removal of Hawaiian's former CEO, John Adams, and the subsequent search for two consecutive bankruptcy trustees.
"Ours is a much cleaner issue with a different structure," Banmiller said. "It's in everybody's best interest not to make bankruptcy an art form because some people have been in there for years."
Banmiller insists that he did not come to Hawai'i with the mandate to take Aloha into bankruptcy.
"I knew we had serious problems," he said. "... But conditions beyond our control, like fuel (costs), forced us into this decision. I knew we couldn't continue the way we had."
Just before Christmas, Banmiller went to Aloha's board of directors and laid out a series of options — including searching for new sources of investment — but ultimately ended up recommending filing for bankruptcy protection.
"I would prefer not to be in bankruptcy," he said. "At the end of the day, we made the decision that would give all of the constituents a better future. ... Given all of the circumstances that we were dealing with, it was the right thing to do."
Banmiller has met with Gov. Linda Lingle, Hawai'i's congressional delegation, each of the county mayors, key legislative leaders and visited each of Aloha's five Hawai'i stations at least twice.
He has sat in Aloha cockpits talking with pilots, visited employee break rooms and spent time on the loading ramp, talking with as many of Aloha's 3,668 employees as he can.
Banmiller said he enjoys speaking with the rank-and-file workers who keep Aloha running and feels at home in any airline's "bag room," where he once worked.
Banmiller believes in projecting a positive attitude, which he insists can be infectious during difficult times.
"People wonder why I smile a lot," he said. "...When you talk about the scary bankruptcy environment and the potential loss of jobs, if you have somebody crumbling in front of you that's supposed to be your leader, then you're going to panic."
And Banmiller brags about the Aloha employees who e-mail him or speak with him in person about their ideas to streamline the operation.
"One longtime flight attendant asked me, 'What can I do to help?'," Banmiller said. "My answer was, 'Keep doing the great job you're doing. ...Things are going to be OK."
Reach Dan Nakaso at [email protected] or 525-8085
New Aloha could emerge by fall
By Dan Nakaso
Advertiser Staff Writer
Aloha Airlines has been under federal bankruptcy protection only since Dec. 30, but the company's new president and chief executive officer already hopes to have Aloha out of bankruptcy by fall.
David Banmiller, the new chief executive of Aloha Airlines, will rely on "the chemistry of communication" and a positive attitude to help the airline emerge from bankruptcy stronger than ever.
Jeff Widener • The Honolulu Advertiser
It will be a much different company then, David Banmiller said in an interview yesterday in the company's Restaurant Row offices.
Aloha Airgroup Inc., the parent company of Aloha Airlines, still would be privately run by family members of the late Hung Wo Ching and businessman Sheridan Ing, Banmiller said. But potential new investors are likely to alter the family stake in the company.
"I think there will be a change in the dynamics of the ownership structure," Banmiller said. "Everybody that we're talking to wants the family to stay in. They're pillars of the community. The only question is how will the ownership percentage dynamic change."
Both managers and union employees also likely will be earning less and saving the company money through other cost-cutting concessions.
The employee changes are just one part of $60 million worth of savings that Banmiller has targeted.
But when Aloha does emerge from bankruptcy, Banmiller expects it will be financially strong and perhaps even enjoy a string of profitable months of operation.
"We're actually in a fairly uncomplicated situation," said Banmiller, 60, who took over Aloha on Nov. 14 after coming from Air Jamaica. "We have a plan and we know we can turn it around economically."
Banmiller has crammed a lot of changes in the two months he's been at Aloha, which had four straight quarterly losses, including a $6 million loss in the third quarter.
On Dec. 2, the company announced the cancellation of its money-losing, twice-weekly flights to the Marshall Islands and to American Samoa. A week later, Aloha eliminated 12 top management positions and froze 35 additional open positions.
Yesterday morning, Banmiller finalized arrangements to add two new daily flights between Orange County and Hawai'i, and a new San Diego-to-Honolulu route.
Then he was off to a meeting with union shop stewards representing Aloha's machinists, part of his efforts to win further concessions from Aloha's five unions.
A tentative agreement with Aloha's pilots seemed imminent earlier in the week. Although the major issues have been settled with the pilots, Banmiller would not detail the cause of the delay.
"We're asking for a lot and it takes time," he said. "We're dealing with five unions in 45 days. It's an incredible task and nobody wants to make a mistake."
Banmiller said, "I believe in the chemistry of communication."
And one of his messages is that Aloha should emerge from bankruptcy quicker than Hawaiian Airlines, which has been in bankruptcy since March 2003.
Hawaiian's bankruptcy reorganization was delayed, in part, by the bitter court fight over the removal of Hawaiian's former CEO, John Adams, and the subsequent search for two consecutive bankruptcy trustees.
"Ours is a much cleaner issue with a different structure," Banmiller said. "It's in everybody's best interest not to make bankruptcy an art form because some people have been in there for years."
Banmiller insists that he did not come to Hawai'i with the mandate to take Aloha into bankruptcy.
"I knew we had serious problems," he said. "... But conditions beyond our control, like fuel (costs), forced us into this decision. I knew we couldn't continue the way we had."
Just before Christmas, Banmiller went to Aloha's board of directors and laid out a series of options — including searching for new sources of investment — but ultimately ended up recommending filing for bankruptcy protection.
"I would prefer not to be in bankruptcy," he said. "At the end of the day, we made the decision that would give all of the constituents a better future. ... Given all of the circumstances that we were dealing with, it was the right thing to do."
Banmiller has met with Gov. Linda Lingle, Hawai'i's congressional delegation, each of the county mayors, key legislative leaders and visited each of Aloha's five Hawai'i stations at least twice.
He has sat in Aloha cockpits talking with pilots, visited employee break rooms and spent time on the loading ramp, talking with as many of Aloha's 3,668 employees as he can.
Banmiller said he enjoys speaking with the rank-and-file workers who keep Aloha running and feels at home in any airline's "bag room," where he once worked.
Banmiller believes in projecting a positive attitude, which he insists can be infectious during difficult times.
"People wonder why I smile a lot," he said. "...When you talk about the scary bankruptcy environment and the potential loss of jobs, if you have somebody crumbling in front of you that's supposed to be your leader, then you're going to panic."
And Banmiller brags about the Aloha employees who e-mail him or speak with him in person about their ideas to streamline the operation.
"One longtime flight attendant asked me, 'What can I do to help?'," Banmiller said. "My answer was, 'Keep doing the great job you're doing. ...Things are going to be OK."
Reach Dan Nakaso at [email protected] or 525-8085
Boy, that Banmiller sure makes me feel all warm and fuzzy inside. What a load of crap.
"Everything's fine now folks, don't you worry your pretty little heads about anything. Well....except maybe your mortgage payment, your baby on the way, your life after retirement. Just shut up and keep doing your job as well as you have been, except for peanuts now."
This guy is good.
"Everything's fine now folks, don't you worry your pretty little heads about anything. Well....except maybe your mortgage payment, your baby on the way, your life after retirement. Just shut up and keep doing your job as well as you have been, except for peanuts now."
This guy is good.
dash8driver
Foamy Specialist
- Joined
- Mar 25, 2002
- Posts
- 1,217
RJP
Registered Eye-Poker
- Joined
- Jul 20, 2004
- Posts
- 1,005
Getter said:
Uh, right.....That's the AQ way of communicating with their people by letting them find out about their pay cut on KITV news or hiring a class a month before furloughing?
Getter said:
HA!
Getter said:
Because he's laughing all the way to the bank, no matter how screwed the employees get, he's going to walk away with $$$. At least he admits he's infectious.
Sleepyhead
Well-known member
- Joined
- Dec 1, 2001
- Posts
- 320
I don't see how you can say AQs pay will be in the Sun Country range.
Using the numbers on airlinepilotpay and calculating for a 75 hr month , here is what you end up with.
..............AQ..... SC.... UAL
5 yr CA $9200 $6900 $ 9000
5 yr FO $5978 $4575 $ 5775
(the above rates assume UAL will take the 13.8% cut in their current TA and that the rumor of a 13% cut at AQ will take place)
I would say AQ is looking more like UAL than Sun Country.
and don't forget, Sun Country has no A or B plan.
English
Well-known member
- Joined
- Nov 26, 2001
- Posts
- 3,374
Ask WW. He told me the salaries will be just barely above Sun Country, as listed on airlinepilotpay.com. He told me this the day before the cancelled meeting. So, unless something changed, or he was lying to me (which I doubt), then I believe the salaries are going to put AQ just above Sun Country.
English
Well-known member
- Joined
- Nov 26, 2001
- Posts
- 3,374
Saturday, January 22, 2005
Aloha Air CEO is
making his moves
David Banmiller has rearranged flights
in hopes of getting out of bankruptcy
By Dave Segal
[email protected]
Aloha Airlines, taking rapid steps to turn around its fortunes after filing for bankruptcy last month, said yesterday it will add two daily flights to Orange County, Calif., and one to San Diego, and drop money-losing daily flights to Vancouver, Canada, and Burbank, Calif.
President and Chief Executive David Banmiller, in an interview at the company's Honolulu headquarters, said the airline lost about $24 million in 2004 and only had about $2 million in unrestricted cash when it filed for Chapter 11 reorganization bankruptcy on Dec. 30.
Banmiller, who took over Nov. 14 for Glenn Zander, said a $3 million loan from the majority shareholders -- the Ching and Ing families -- and a 60-day suspension of aircraft lease payments helped the airline accumulate nearly $10 million in cash.
He said he hopes to announce labor agreements in the next two weeks and said he is "fairly along" in negotiations on new aircraft leases. Banmiller, who is seeking $60 million in cost cuts, hopes to get $36 million of that through reduced labor costs and $10 million through renegotiated leases. Other costs cuts are expected to come from halting flights to the Marshall Islands and Pago Pago, American Samoa; fuel conservation; improved efficiency; and cuts to in-flight products, travel agent commissions and insurance premiums.
Banmiller, whose experience includes the Orange County market, said the airline wants to tap growth in that area by adding two flights, one from Honolulu and one from Maui, to bring the total to five between Hawaii and John Wayne Airport. In addition, the airline's new Honolulu-San Diego service will complement the Maui-San Diego service that began Dec. 15. The additional Orange County and San Diego flights will begin April 3.
"Orange County has a dramatically growing demographic, a high disposable-income environment and a lots of leisure travel opportunities," Banmiller said.
To make room for the additional flights, Aloha is discontinuing its Burbank-Reno, Nev., service effective Feb. 1 and eliminating all service to Burbank on April 3. The airline typically has two daily flights to Burbank -- one from Maui and one from Honolulu. Aloha's service to Vancouver will end April 11. Passengers booked on future flights to Burbank and Vancouver either will be switched to another airport, offered a refund or put on another airline.
Banmiller, who is hoping to get the airline out of bankruptcy as early as the fall, declined to identify potential investors but said more than 20 investors have signed nondisclosure agreements. He said the Ching and Ing families hope to remain in an ownership capacity.
"There's significant interest from very serious people," Banmiller said. "We're not dealing with people who would package an investment. We're only dealing with principals -- either investment houses, hedge funds, private individuals. And it's way beyond whoever was involved in Hawaiian."
Banmiller said the company has reached an agreement with the federal Air Transportation Stabilization Board to defer $2.8 million of a $3.5 million monthly payment on a $45 million loan. He also said negotiations are continuing with First Hawaiian Bank, which processes the airline's credit cards.
The former Air Jamaica executive said it is unlikely the airline will add any new routes this year, but it is still interested in Ronald Reagan Washington National Airport in Washington, D.C., after losing out last year in a federal application process. He said Midway Airport in Chicago also is a possibility.
Banmiller said the airline's cargo and contract services units that have been shopped around "are doing OK right now," and they only would be sold if the situation warrants and the price was right. He said the company has talked to Boeing about bringing in 717s to replace the 737-200s used for interisland fights.
But he said that due to parts availability, retraining and other factors, any fleet changes would be put off until after bankruptcy.
Banmiller, describing himself as "an eternal optimist," said he is not a quitter and that filing for Chapter 7 liquidation is "unacceptable." He said the airline might be able to show an operating profit in 2006.
"What I'm going to do is use this opportunity to clean up the balance sheet, stabilize the company, have a better cash position, effect a few changes and then go out and concentrate on running a fantastic airline," he said.
Airing it out
Highlights from an interview yesterday with Aloha Airlines President and Chief Executive David Banmiller, who is seeking to bring the airline out of Chapter 11 bankruptcy:
» The airline is adding two daily flights to Orange County, Calif., one from Maui and the other from Honolulu; it is also adding a Honolulu flight to San Diego. The new flights begin April 3.
» Aloha also is eliminating Hawaii flights to Burbank, Calif., on April 3 and Burbank-Reno, Nev., on Feb. 1. It is discontinuing Honolulu service to Vancouver, Canada, on April 11.
» The airline lost about $24 million in 2004.
Aloha Air CEO is
making his moves
David Banmiller has rearranged flights
in hopes of getting out of bankruptcy
By Dave Segal
[email protected]
Aloha Airlines, taking rapid steps to turn around its fortunes after filing for bankruptcy last month, said yesterday it will add two daily flights to Orange County, Calif., and one to San Diego, and drop money-losing daily flights to Vancouver, Canada, and Burbank, Calif.
President and Chief Executive David Banmiller, in an interview at the company's Honolulu headquarters, said the airline lost about $24 million in 2004 and only had about $2 million in unrestricted cash when it filed for Chapter 11 reorganization bankruptcy on Dec. 30.
Banmiller, who took over Nov. 14 for Glenn Zander, said a $3 million loan from the majority shareholders -- the Ching and Ing families -- and a 60-day suspension of aircraft lease payments helped the airline accumulate nearly $10 million in cash.
He said he hopes to announce labor agreements in the next two weeks and said he is "fairly along" in negotiations on new aircraft leases. Banmiller, who is seeking $60 million in cost cuts, hopes to get $36 million of that through reduced labor costs and $10 million through renegotiated leases. Other costs cuts are expected to come from halting flights to the Marshall Islands and Pago Pago, American Samoa; fuel conservation; improved efficiency; and cuts to in-flight products, travel agent commissions and insurance premiums.
Banmiller, whose experience includes the Orange County market, said the airline wants to tap growth in that area by adding two flights, one from Honolulu and one from Maui, to bring the total to five between Hawaii and John Wayne Airport. In addition, the airline's new Honolulu-San Diego service will complement the Maui-San Diego service that began Dec. 15. The additional Orange County and San Diego flights will begin April 3.
"Orange County has a dramatically growing demographic, a high disposable-income environment and a lots of leisure travel opportunities," Banmiller said.
To make room for the additional flights, Aloha is discontinuing its Burbank-Reno, Nev., service effective Feb. 1 and eliminating all service to Burbank on April 3. The airline typically has two daily flights to Burbank -- one from Maui and one from Honolulu. Aloha's service to Vancouver will end April 11. Passengers booked on future flights to Burbank and Vancouver either will be switched to another airport, offered a refund or put on another airline.
Banmiller, who is hoping to get the airline out of bankruptcy as early as the fall, declined to identify potential investors but said more than 20 investors have signed nondisclosure agreements. He said the Ching and Ing families hope to remain in an ownership capacity.
"There's significant interest from very serious people," Banmiller said. "We're not dealing with people who would package an investment. We're only dealing with principals -- either investment houses, hedge funds, private individuals. And it's way beyond whoever was involved in Hawaiian."
Banmiller said the company has reached an agreement with the federal Air Transportation Stabilization Board to defer $2.8 million of a $3.5 million monthly payment on a $45 million loan. He also said negotiations are continuing with First Hawaiian Bank, which processes the airline's credit cards.
The former Air Jamaica executive said it is unlikely the airline will add any new routes this year, but it is still interested in Ronald Reagan Washington National Airport in Washington, D.C., after losing out last year in a federal application process. He said Midway Airport in Chicago also is a possibility.
Banmiller said the airline's cargo and contract services units that have been shopped around "are doing OK right now," and they only would be sold if the situation warrants and the price was right. He said the company has talked to Boeing about bringing in 717s to replace the 737-200s used for interisland fights.
But he said that due to parts availability, retraining and other factors, any fleet changes would be put off until after bankruptcy.
Banmiller, describing himself as "an eternal optimist," said he is not a quitter and that filing for Chapter 7 liquidation is "unacceptable." He said the airline might be able to show an operating profit in 2006.
"What I'm going to do is use this opportunity to clean up the balance sheet, stabilize the company, have a better cash position, effect a few changes and then go out and concentrate on running a fantastic airline," he said.
Airing it out
Highlights from an interview yesterday with Aloha Airlines President and Chief Executive David Banmiller, who is seeking to bring the airline out of Chapter 11 bankruptcy:
» The airline is adding two daily flights to Orange County, Calif., one from Maui and the other from Honolulu; it is also adding a Honolulu flight to San Diego. The new flights begin April 3.
» Aloha also is eliminating Hawaii flights to Burbank, Calif., on April 3 and Burbank-Reno, Nev., on Feb. 1. It is discontinuing Honolulu service to Vancouver, Canada, on April 11.
» The airline lost about $24 million in 2004.
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