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Midway Airlines Ceases Operations; 1,700 Jobs Lost
Wednesday, September 12, 2001
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Embattled regional carrier Midway Airlines on Wednesday became the first U.S. company to officially cease business as a result of Tuesday's terror attacks in the United States.
Midway Airlines, citing the impact of Tuesday's terrorist attacks on its already precarious financial situation, said it would immediately suspend all flight operations.
Some 1,700 employees were immediately put out of work, the airline said.
At the time of the announcement, all airline flights in the United States were still grounded by the Federal Aviation Administration one day after hijacked jet planes destroyed the World Trade Center's twin towers in New York and damaged the Pentagon in Washington, D.C.
Midway filed for Chapter 11 bankruptcy protection on Aug. 13. Immediately after that filing, the airline laid off 700 workers, grounded 17 aircraft and canceled delivery of several new planes. The airline had expected to lay off about 300 more workers by the end of the year.
Industry experts have predicted a fall-off in demand for air travel because of consumers' safety concerns after the attacks.
Midway said its ticket holders would be entitled to refunds, and it would attempt to contact them. The company also said it would begin returning aircraft to its lessors, effective immediately, and would solicit purchasers for its remaining assets.
The company said it anticipates paying all obligations incurred following its Chapter 11 bankruptcy filing on Aug. 14 and will propose a reorganization plan to deal with all obligations which arose prior to the filing.
``We are deeply troubled by the impact this action will have on our customers, employees, creditors and the community,'' the company said. ``Unfortunately, we simply do not have the resources necessary to permit us to reorganize in this environment.
Reuters and the Associated Press contributed to this report.
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