From the Raleigh News and Observer:
January date set for Midway
By DUDLEY PRICE, Staff Writer
MORRISVILLE -- Midway Airlines' plan to return to the sky has been delayed until January.
The Morrisville-based airline, which has been grounded since mid-July, wanted to become airborne in October as a regional feeder airline for US Airways but moved slower than expected toward meeting requirements. Midway now isn't expected to resume flights until Jan. 15, US Airways spokesman David Castelveter said Friday.
We are moving forward with our plan to work with Midway Airlines as a US Airways Express carrier, Castelveter said. We still plan to work with Midway Airlines as an express carrier ... in early January.
The two airlines, both in Chapter 11 bankruptcy protection, missed their own timetable for implementing the deal. Midway, once the Triangle's busiest carrier, ceased flights July 17 but planned to offer flights from Raleigh-Durham International Airport to three northern cities in October provided it met the requirements of US Airways.
US Airways told Midway it needed agreement from unions representing its pilots and flight attendants, leases on 18 regional jets and a $5 million security loan for working capital by Aug. 31. When Midway got the union approvals on time but not the loan or jetliner leases, US Airways extended the deadline to Oct. 31.
Castelveter declined to comment whether Midway had the loan or jetliners. Midway Chief Executive Bob Ferguson did not return a phone call, and Midway attorney Jeb Jeutter could not be reached.
Midway said two weeks ago it was negotiating with lessors for the planes and potential investors.
But some industry experts say Midway might be having trouble leasing the 50-seat regional jets, which are in high demand by airlines who want to fly smaller planes because fewer passengers are buying tickets.
The deal with US Airways is important because it will be the centerpiece of Midway's reorganization plan showing how the company, which has been under Chapter 11 protection for 14 months, expects to operate as a viable business. Midway initially planned to have a reorganization plan by Sept. 1 but missed that self-imposed deadline.
Last month, U.S. Bankruptcy Judge A. Thomas Small gave Midway until Jan. 30 to submit a plan. If Midway can't show how it will be a sustainable business, the judge could dismiss the case or convert it to Chapter 7 bankruptcy and order a sale of assets to satisfy creditors.
US Airways, the second-busiest carrier at RDU, on Friday reported that its net loss for the third quarter narrowed to $335 million as the company cut flights, eliminated jobs and reduced its debt. Sales fell 12 percent to $1.75 billion.
Staff writer Dudley Price can be reached at 829-4525 or
[email protected].