Both Delta and Northwest Airlines file Chapter 11
Posted By RichC on September 14, 2005
The number three airline, Delta Airlines (DAL) proceeds with bankrupcy protection as suspected and stock prices closes the day at 78 cents. Northwest Airlines (NWAC) closes at $1.87 as it to joins Delta in filing Chapter 11 bankrupcy today as well; indications are that its stock will open a dollar lower on Thursday.
Considering Delta is the major airline that hubs in Cincinnati, there may be a concern in regard to flight interuptions. Passengers most likely will not notice any service disruption as the airline intends to operate flights as usual. Be advised though, as a ticket holder that you are considered a creditor and will be at the bottom of the pile in attempting to collect on any dollars that might be due to you in the event the company collapses.
High fuel prices are credited as the final straw for these two Airlines. Delta is based out of Atlanta and has a “crushing debt load of more than $20 billion” and one of the industry’s biggest underfunded pension burdens. It will be highly unlikely that either will be able to recover without government intervention.
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