Carrier Exits Chapter 11 Ahead Of Schedule
ANN REALTIME REPORTING 04.30.07 1300 EDT: The
last 19-months have been extremely difficult ones for Delta Air
Lines, ever since the Atlanta, GA-based carrier filed for Chapter 11 bankruptcy in
What followed that announcement included contentious negotiations between the
airline and its pilots... that often appeared to
threaten the very future of the airline, before an agreement was
finally reached last year.
(including Aero-News) also took jabs at Delta for choosing to unveil pricey new uniforms
under bankruptcy (shown at right), while at the
same time asking workers to help clean
planes gratis on their time off.
Oh, and then there was also the nagging threat of a hostile takeover by US
Airways. Remember that?
Through it all, however, executives at Delta maintained their
airline would survive, and exit bankruptcy by early 2007 -- a full
year ahead of schedule. On Monday, the airline made good on that
"This is an amazing day for an extraordinary company, which has
reclaimed its heritage and has emerged from Chapter 11 as a fierce,
determined and well-capitalized competitor," Delta chief bankruptcy
attorney Marshall Huebner told CBS News.
CNN Money reports Delta emerges from bankruptcy a far different
airline than before. In its quest to shave capacity, Delta shed
roughly one airplane in six used by its mainline operations...
which coincided with a surge in passenger bookings throughout the
industry. Almost from the start, that allowed Delta to carry more
passengers on fewer aircraft... while also charging passengers more
money to do so.
"Through our restructuring we have successfully repaired our
balance sheet, improved the customer experience, expanded our
international route system and built a platform for future
success," said Delta Chief Executive Gerald Grinstein.
On a darker note, the carrier also cut over 20 percent of the
60,000-strong workforce in place at the time of the bankruptcy
remaining with the carrier note a change in the atmosphere at
Delta, however... a return of sorts to its workforce-oriented
roots, and a sense of camaraderie fostered by the airline's
successful fight against the US Airways merger bid. Those
warm-fuzzies are also, perhaps, due in part to the $480 million in
cash and stock options the airline's employees are scheduled to
receive, as part of a restructured pay and incentives package.
That plan also includes profit-sharing options and bonuses for
staff and executives... but several Delta execs, including CEO Grinstein (right),
have said publicly they won't accept the additional funds, in a
show of solidarity.
Next up for Delta will be an announcement of rebranding efforts
-- scheduled for Monday afternoon -- which many believe will
include a new Delta livery. The carrier's new Board of Directors
will also soon decide on two significant issues: what to do with
Delta's trouble-plagued regional subsidiary, Comair, and who will
succeed Grinstein once he steps down as Delta CEO.
For today, though... there is likely only one issue on the mind
of Delta employees. Travel analyst Terry Trippler told CBS it's
likely passengers may see "a bounce in the step" and "a smile on
the face" of Delta workers... happy with the knowledge their
airline is solvent once again.