NORTHWEST AIRLINES FILES FOR BANKRUPTCY

admin's picture

By Liberty Dones

SAIPAN, CNMI (Saipan Tribune, Sept. 16) – Northwest Airlines, which plans to begin direct flights between Osaka and Saipan next month, says that its operations will remain normal despite its filing of Chapter 11 bankruptcy in New York yesterday.

"Normal operations continue," said the airline in a statement, noting that it has $1.5 billion in cash and investments currently available for use.

The company said it would continue "to serve customers, honor tickets, fly its competitive schedule and continue the WorldPerks frequent flyer and WorldPerks Visa programs."

This came as NWA prepares for its direct Osaka-Saipan daily flights, which will begin on Oct. 1 this year, a move that is welcomed by the Commonwealth of the Northern Mariana Islands government in view of the pullout of Japan Airlines from the Marianas next month.

Right now, NWA flies daily to Saipan from Tokyo and Nagoya.

Press secretary Peter A. Callaghan said yesterday that the administration is not worried over the news about Northwest's filing for bankruptcy.

"We're not concerned. Based on the information, the move is to allow them to restructure their debt and get out of some expensive bonds they have floated," he said.

NWA, the world's fourth largest airline, said it filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York.

Northwest expects that its fuel bill for 2005 will be approximately $3.3 billion, a huge jump from last year's $2.2 billion and 2003's $1.6 billion.

A Chapter 11 petition will allow the company to restructure its debts, so it can continue to operate.

NWA carries more than 55 million passengers annually around the world.

Delta Air Lines, the nation's third largest carrier, also filed for the same court protection yesterday. Both cited the recent spike in jet fuel costs, which have soared nearly 20 percent since June 1, as prime reasons for seeking protection from creditors under Chapter 11 of federal bankruptcy laws.

September 16, 2005

Saipan Tribune http://www.saipantribune.com

Rate this article: 
No votes yet

Add new comment