lowecur
Well-known member
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- Sep 14, 2003
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I mentioned a while back that the new BK law to take effect on Oct 17th would force both of these carriers into Chapt 11. Looks like that may happen. DL needs to unload the twin sisters as the RJ is killing them, and NWA just has too many hard nosed employees to settle out of court.
2 airlines likely to file Chap. 11 in September
By The Washington Post | August 2, 2005
WASHINGTON -- Northwest and Delta Air Lines are likely to file for Chapter 11 bankruptcy protection in mid-September, a month before a more restrictive bankruptcy law goes into effect, bankruptcy experts and airline insiders say.
The airlines are expected to delay any action until around the Labor Day weekend to avoid distressing employees during the busy summer travel period.
Last week, Northwest reported a second-quarter loss of $225 million, compared with a loss of $182 million for the same quarter in 2004. The airline is trying to get its employees to agree to $1.1 billion in pay and benefit cuts. So far, it has secured cuts of about $265 million from its pilots and $35 million from its management and salaried workers. The carrier is losing about $4 million a day.
Douglas Steenland, Northwest's chief executive, has refused to speculate whether or when the airline would file for bankruptcy. But he said the new law taking effect Oct. 17 would be ''one of the factors" in the decision-making.
Delta chief executive Gerald Grinstein last week told employees the airline's efforts to cut about $5 billion were not enough. Delta posted a $382 million second-quarter loss. Delta was preparing to file for bankruptcy in October when pilots agreed to wage and benefit cuts of about $1 billion a year.
Congress passed the new bankruptcy law in April, in part to force companies to reorganize quicker and to bar them from paying retention bonuses, except if executives have proved they have job offers. ''Very often the same managers who got the company in trouble were . . . getting retention bonuses
2 airlines likely to file Chap. 11 in September
By The Washington Post | August 2, 2005
WASHINGTON -- Northwest and Delta Air Lines are likely to file for Chapter 11 bankruptcy protection in mid-September, a month before a more restrictive bankruptcy law goes into effect, bankruptcy experts and airline insiders say.
The airlines are expected to delay any action until around the Labor Day weekend to avoid distressing employees during the busy summer travel period.
Last week, Northwest reported a second-quarter loss of $225 million, compared with a loss of $182 million for the same quarter in 2004. The airline is trying to get its employees to agree to $1.1 billion in pay and benefit cuts. So far, it has secured cuts of about $265 million from its pilots and $35 million from its management and salaried workers. The carrier is losing about $4 million a day.
Douglas Steenland, Northwest's chief executive, has refused to speculate whether or when the airline would file for bankruptcy. But he said the new law taking effect Oct. 17 would be ''one of the factors" in the decision-making.
Delta chief executive Gerald Grinstein last week told employees the airline's efforts to cut about $5 billion were not enough. Delta posted a $382 million second-quarter loss. Delta was preparing to file for bankruptcy in October when pilots agreed to wage and benefit cuts of about $1 billion a year.
Congress passed the new bankruptcy law in April, in part to force companies to reorganize quicker and to bar them from paying retention bonuses, except if executives have proved they have job offers. ''Very often the same managers who got the company in trouble were . . . getting retention bonuses