Go Back  FlyerTalk Forums > Travel&Dining > Travel News
Reload this Page >

F9 Files for Ch11 due to liquidity issues from cc

F9 Files for Ch11 due to liquidity issues from cc

Old Apr 11, 08, 12:54 am
  #1  
Original Poster
 
Join Date: Jul 2005
Location: SJC/SFO/OAK
Programs: BD Gold (and future SEN), 0.2MM AA EXP, HHonors Gold, SPG Gold
Posts: 3,107
F9 Files for Ch11 due to liquidity issues from cc

http://www.frontierairlines.com/fron...ss-releases.do

Apparently, cc processing was holding back funds, creating a liquidity issue and forcing Ch11 filing, which would prevent said holdings.
cstead is offline  
Old Apr 11, 08, 1:09 am
  #2  
Suspended
 
Join Date: Nov 2004
Location: unreserved car luggage rack
Programs: Indian Railways Wallah Program
Posts: 6,532
F9 = Frontier Airlines for those unfamiliar
cj001f is offline  
Old Apr 11, 08, 1:12 am
  #3  
FlyerTalk Evangelist
 
Join Date: Mar 2004
Location: Newport Beach, California, USA
Posts: 36,062
Wow. Where will this end? What is that . . . 4 carriers in the last week that have gone BK?
PTravel is offline  
Old Apr 11, 08, 1:19 am
  #4  
FlyerTalk Evangelist
 
Join Date: Jul 1999
Location: ORD/MDW
Programs: BA/AA/AS/B6/WN/ UA/HH/MR and more like 'em but most felicitously & importantly MUCCI
Posts: 19,120
They say they'll continue to fly the full schedule. Operating through C11 is a little different from shutting down altogether... still, it's another bad sign. Oasis, ATA, Aloha, Champion, and Skybus wiped out in the space of a few days... and now this.
BearX220 is offline  
Old Apr 11, 08, 1:21 am
  #5  
FlyerTalk Evangelist
 
Join Date: Jul 2005
Location: Seat 2A
Programs: AA EXP LT GLD 1MM, BA GLD, NH/UA*G, Hyatt Dia, Marr Tit LT PLT, IHG Spire,HH Dia, MGM NOIR,Hertz PC
Posts: 10,468
It's an insane tendency in bankrupcy cases of airlines...

I wonder what the reason is right now !?

Also the inspections of the 777 and MD80 fleet couldnt come at a worse time than now. But this hole AA they digged themselves...
skywalkerLAX is offline  
Old Apr 11, 08, 4:50 am
  #6  
B1
 
Join Date: Apr 2000
Location: Toronto, Ontario, Canada
Posts: 3,665
New York TImes covers the story

The airline continues in business but credit card problems led to the action.
"The low-fare carrier said its filing Friday came after an unexpected attempt by its principal credit card processor to start withholding significant proceeds from the sale of Frontier tickets, which threatened to hurt Frontier's liquidity.
The Chapter 11 filing in U.S. Bankruptcy Court in New York prevents the credit card processor from increasing its ''holdback,'' Frontier CEO Sean Menke said."
B1 is offline  
Old Apr 11, 08, 9:18 am
  #7  
A FlyerTalk Posting Legend
 
Join Date: Apr 2001
Location: NYC
Posts: 69,204
Frontier was profitable for a while and reasonably well established. I think that they're more likely to survive this (similar to NW/DL/UA's recent bankruptcy filings) than not. Then again, this is the type of thing that can cause a run on an airline. You get a large CC processor saying that they think that carrier is unstable and next thing you know, the carrier is unstable. At least Frontier has a chance here, while ATA and SkyBus had none.
sbm12 is offline  
Old Apr 14, 08, 10:32 am
  #8  
 
Join Date: Apr 2008
Location: Slumin' In Newark
Posts: 5
Originally Posted by sbm12 View Post
Frontier was profitable for a while and reasonably well established. I think that they're more likely to survive this (similar to NW/DL/UA's recent bankruptcy filings) than not. Then again, this is the type of thing that can cause a run on an airline. You get a large CC processor saying that they think that carrier is unstable and next thing you know, the carrier is unstable. At least Frontier has a chance here, while ATA and SkyBus had none.
With no "real" international, no p clubs, no code-shares worth a crap, it's obvious that Frontier had/has no real chance of continuing a viable operation. Both United and Southwest, who have extrememly large cash reserves, will be circling the pool with blood in it. Look for Mesa, North American, Omni Air Intl, Sun Country, Allegiant, and possibly Airtran to follow Frontier into BK.
EWR787Driver is offline  

Thread Tools
Search this Thread
Search Engine: