Tag Archives: bankruptcy

What Southwest Airlines Is Telling Their Employees About the Deal For Frontier Airlines

One of our PlaneBusiness Banter subscribers just passed along this information to us. It was communicated to employees via a Southwest Airlines’ Today@SWA email.

The airline has a press conference scheduled for 2 p.m. CT to talk about the airline’s bid.

Southwest Submits Nonbinding Proposal to Acquire Frontier Airlines

On Thursday, July 30, Southwest Airlines submitted a nonbinding proposal to acquire Frontier Airlines in accordance with the bidding procedures in the bankruptcy court.  We view this as an exciting opportunity for the Employees and Customers of both Southwest and Frontier. It represents an opportunity for Southwest to grow our Denver Customers; grow our revenues; and grow our profits. We must caution, however, that this is merely a preliminary step in the bidding process.

We must submit a binding proposal by August 10.  If there is more than one qualified investor, and at this time Republic Airways has also submitted a bid, an auction will be held beginning August 11.  Frontier will determine, in consultation with the unsecured creditors committee, which bid to accept and present to the bankruptcy court for approval.   

Although our plans may vary as we work our way through this process, we wanted to share with you our present plan as we envision it.  Frontier would continue to operate independently and separately for a period of time with its Airbus aircraft and personnel.  We do not intend to integrate the Airbus into our Boeing 737 fleet. As we are able to retire Airbus aircraft, we will add Boeing 737 aircraft. Over time, Frontier employees would be hired into Southwest as needed to support our fleet growth and expanded operations.  There are many details to be worked through, but we are confident that the effort will be worthwhile. We are also confident that our bid, if successful, will boost low-fare competition and benefit consumers in Denver and other cities our expanded network will serve.

Even if our bid is accepted and approved by the bankruptcy court, our closing on this transaction will be subject to several contingencies. These will include the negotiation of acceptable labor agreements dealing with the interim period of separate operation and seniority; and the appropriate regulatory review.  Absent the negotiation of these labor agreements, we will not go forward with this transaction.  However, we are confident that the benefits of such a transaction for Employees of both Southwest and Frontier will become self-evident and that we will be able to obtain such agreements.

Look Who Is Now On the Chrysler Board of Directors

I couldn’t help but laugh when one of our readers sent us this note today:

“I noted with interest yesterday the appointment of [former Northwest Airlines CEO] Doug Steenland and [former United and US Airways CEO] Stephen Wolf to the new Chrysler board of directors.

In a perhaps related development, did you hear that Chrysler as part of its push for streamlined operations and greater efficiency is going to adopt the Henry Ford model for paint choices. From now on, you can order your new Chrysler, Dodge or Jeep in any color you wish — as long as it’s gray.  

Blue and red pinstripes, $500 extra.”

Rimshot please.

Keep Those Comments Coming on How The Financial Meltdown Is Affecting You


Last week I talked here about how the economic and financial situation was affecting those of you who read us on a regular basis.

Thanks to all of you who have responded so far. I definitely hit a nerve with this one.

Keep those comments coming. I’ll follow up with excerpts from them later this week.

My Own “United Airlines Bankruptcy” Old News Experience

Every week as I sit down and begin to gather my mental notes for the next issue of PlaneBusiness Banter, I begin a process of routine news searches — looking for articles dealing with some aspect of the industry. news_killershrimp.gif

Sometimes I do this looking for more information on a story that most people already know something about. But oftentimes the payoff comes when a story that I was not aware of pops up on the computer screen.

And so it was last week when I came upon a story that talked about how American Airlines had been forced to cancel hundreds of flights flown by MD-80s as the FAA issued new inspections be done on the aircraft.

The headline on the story, “FAA Crackdown Could Lead to More Delays.”

I hadn’t heard a word about this.

No one had sent me a note about it.

I looked at the date on the top of the story. September 3, 2008.

The article began:

FAA Crackdown Could Lead to More Delays

Posted on: Wednesday, 3 September 2008, 21:00 CDT

By Michael Sean Comerford Daily Herald Business Writer


Three airline fleet related actions in three weeks by the Federal Aviation Administration may indicate more inspection- related flight delays ahead, airline analysts said Wednesday.

The latest U.S. airline to ground its own planes Wednesday was American Airlines, the world’s largest carrier.

The airline canceled 300 flights to re-inspect wiring in Boeing Co. MD-80s after federal regulators raised questions during a maintenance audit.

Southwest Airlines and United Airlines have also recently been subject to FAA actions.

American Airline’s cancellations represented about 13 percent of its Wednesday flights. American Airlines is checking whether a sleeve covering a bundle of wires was installed according to a FAA directive, spokesman Tim Wagner said.

About 80 flights were canceled at the carrier’s Dallas-Fort Worth hub, and about 68 more at O’Hare International Airport. The rest were scattered across the U.S.

Most passengers had been booked on other flights, according to spokesman Tim Wagner, but some may have been delayed until this morning.

As of Wednesday evening, no further flight delays at O’Hare had been announced for today, Wagner said.

I then re-read the article one more time — this time looking to see if I could determine if, in fact, this story had been written in April — not last week — when American was forced to cancel thousands of flights because of an FAA crackdown.

And sure enough, with that second reading it was clear that the story that while the story had been tagged as current, it was, in fact, six months old.

How does this happen?

I’m not sure how it happened in the case of the United Airlines bankruptcy news story that went public Monday that was 6 years old.

Nor am I sure how it happened that this particular story about “FAA Crackdown causing more delays” was posted with a current date and then picked up by the usual news aggregators — when it was, in fact, 6 months old.

But what I do know is that every once in a while, when I post a new post to Movable Type, which is the blog software program that powers this blog — the software will, for some unexplained reason — arbitrarily pull a post from 2006 and post it, along with the right one — with both dated with the current date.

Actually, It happened yesterday. When it happens I have to go in, unpublish the older post, and then republish it — using my best guess as to its original date.

So while I, along with a lot of other people, wait for more details concerning the alleged “reposting” of the six-year old bankruptcy news story — I’m here to vouch that yes, content management systems can be flaky. It can happen. And it does.

Now whether this was an intentional posting is another matter. And I’m sure we’ll find out if it was or not in the coming weeks as the SEC tracks down who posted what and when — and why.