Republic Airways files for Chapter 11 bankruptcy
Wednesday, 26 Feb, 2016
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Republic Airways Holdings has finally succumbed to operational difficulties due to a lack of pilots, announcing a filing for Chapter 11 bankruptcy protection.
The Indianapolis-based company said it had about $3 billion in liabilities and the bankruptcy process would enable the airline to continue normal operations while restructuring takes place.
Republic has long struggled with a pilot shortage, exacerbated by labor disputes, and last year warned it could ultimately result in bankruptcy.
The Republic business includes Chautauqua Airlines, Republic Airlines and Shuttle America with a combined fleet of more than 250 aircraft.
It offers regional feeder services on behalf of the ‘big three’ carriers, branded respectively as American Eagle, Delta Connection and United Express.
"We worked hard to avoid this step. Over the last several months, we’ve attempted to restructure the obligations on our out-of-favor aircraft – made so by a nationwide pilot shortage – and to increase our revenues," Republic CEO Bryan Bedford said in a statement.
"Our filing today is a result of our loss of revenue during the past several quarters associated with grounding aircraft due to a lack of pilot resources, combined with the reality that our negotiating effort with key stakeholders shows no apparent prospect of a near term resolution."
It is the first bankruptcy petition for a major US airline business since American Airlines filed in 2011.
Smaller regional carrier SeaPort Airlines recently filed for bankruptcy, also citing a pilot shortage.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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