Reuters
UPDATE - Midwest Express unions tentatively OK cost cuts
Friday July 11, 5:50 pm ET
By David Bailey
(Recasts; adds byline, comments from air carrier)
CHICAGO, July 11 (Reuters) - Midwest Express Holdings Inc. (NYSE:MEH - News) has reached tentative cost cut deals with three labor groups, but still faces bankruptcy if it cannot restructure airplane payments by mid July, a spokeswoman said on Friday.
Midwest Express is still trying to cut payments on 38 airplanes in its fleet in talks with 11 lessors or lenders, and failure to complete just those talks would force a Chapter 11 bankruptcy filing, spokeswoman Carol Skornicka said.
The Milwaukee-based air carrier has said that bankruptcy was likely if workers, lenders and airplane financiers did not agree to cost-cuts by a July 15 company deadline.
"We have been reworking all of our agreements, but none are as significant as (labor and airplane financings)," Skornicka said. "Any one of these pieces not coming together, could, would be something that would put us into Chapter 11."
Pilots and flight attendants at Midwest Express unit Midwest Airlines have tentatively agreed to cost cuts that include wage and work rule changes, Skornicka said.
Pilots for the Midwest Express regional carrier Skyway Airlines on Thursday announced tentative cost cuts as well with plans to vote on the agreement by mid July.
"At the end of the day, (all three labor agreements) are going to be generating savings for us by a combination of work rule changes and wage concessions," Skornicka said.
Midwest Airlines pilots have been working under temporary pay cuts in place through Nov. 1 that would be replaced by a combination of cuts if pilots ratify the longer term deal reached Thursday, said Jerome Schnedorf, chairman of the Midwest unit of ALPA.
The 285 active Midwest Airlines pilots are expected to finish voting on the agreement late Tuesday. The unit had 400 active members in fall 2001, but has been pared by furloughs.
"While we maintain that our pilots are not the cause of our airline's financial difficulties, in the end we must focus on turning our airline around considering the current economic situation in the industry," Schnedorf said.
Shares of Midwest Express rose 34 cents, or 15.74 percent, to $2.50 Friday on the New York Stock Exchange (News - Websites).
UPDATE - Midwest Express unions tentatively OK cost cuts
Friday July 11, 5:50 pm ET
By David Bailey
(Recasts; adds byline, comments from air carrier)
CHICAGO, July 11 (Reuters) - Midwest Express Holdings Inc. (NYSE:MEH - News) has reached tentative cost cut deals with three labor groups, but still faces bankruptcy if it cannot restructure airplane payments by mid July, a spokeswoman said on Friday.
Midwest Express is still trying to cut payments on 38 airplanes in its fleet in talks with 11 lessors or lenders, and failure to complete just those talks would force a Chapter 11 bankruptcy filing, spokeswoman Carol Skornicka said.
The Milwaukee-based air carrier has said that bankruptcy was likely if workers, lenders and airplane financiers did not agree to cost-cuts by a July 15 company deadline.
"We have been reworking all of our agreements, but none are as significant as (labor and airplane financings)," Skornicka said. "Any one of these pieces not coming together, could, would be something that would put us into Chapter 11."
Pilots and flight attendants at Midwest Express unit Midwest Airlines have tentatively agreed to cost cuts that include wage and work rule changes, Skornicka said.
Pilots for the Midwest Express regional carrier Skyway Airlines on Thursday announced tentative cost cuts as well with plans to vote on the agreement by mid July.
"At the end of the day, (all three labor agreements) are going to be generating savings for us by a combination of work rule changes and wage concessions," Skornicka said.
Midwest Airlines pilots have been working under temporary pay cuts in place through Nov. 1 that would be replaced by a combination of cuts if pilots ratify the longer term deal reached Thursday, said Jerome Schnedorf, chairman of the Midwest unit of ALPA.
The 285 active Midwest Airlines pilots are expected to finish voting on the agreement late Tuesday. The unit had 400 active members in fall 2001, but has been pared by furloughs.
"While we maintain that our pilots are not the cause of our airline's financial difficulties, in the end we must focus on turning our airline around considering the current economic situation in the industry," Schnedorf said.
Shares of Midwest Express rose 34 cents, or 15.74 percent, to $2.50 Friday on the New York Stock Exchange (News - Websites).
