US Airways goes bankrupt
Sept. 11 attacks take heavy toll on carrier's finances
By Matthew Barakat
ARLINGTON, Va. -- US Airways has become the first major airline to declare bankruptcy since last year's terrorist hijackings, a move that came 11 months to the day after the industry was rocked by the attacks.
US Airways, the nation's seventh-largest carrier, said flights will continue normally, and the company expressed optimism that it will emerge from bankruptcy early next year.
The airline has one gate at Minneapolis-St. Paul International Airport, and operates from 16 to 20 flights daily, said Patrick Hogan, a spokesman for the Metropolitan Airports Commission.
In its Chapter 11 bankruptcy filing Sunday, the company listed assets of $7.81 billion and liabilities of $7.83 billion and said its cash flow was relatively stable. But Chris Chiames, US Airways' vice president for corporate affairs, said that would not last with the peak summer travel season about to end.
"You do not want to enter bankruptcy in a poor cash position," Chiames said at a brief news conference.
Chapter 11 allows a company to continue operating and hold its creditors at bay while it puts its finances in order.
US Airways had been struggling well before Sept. 11. In July of 2001, the airline suffered a blow when federal regulators balked at a proposed purchase by United Airlines that would have given US Airways investors $60 a share.
After the attacks, no airline was harmed financially more than US Airways. The Arlington-based carrier is the largest airline at Reagan Washington National Airport, which remained closed for weeks after the attacks.