Airline to go out of business

Thursday, September 13, 2001

RALEIGH, N.C. -- Midway Airlines, already staggered by financial problems, said Wednesday it will go out of business rather than try to rebuild amid the emotional fallout from this week's terrorist hijackings.

Some 1,700 employees were immediately put out of work, on top of 700 who were laid off when the airline filed for Chapter 11 bankruptcy Aug. 13.

The company said in a statement the action was being taken "with the recognition that, following the recent terrorist attacks, demand for air transportation is expected to decline sharply."

Four hijacked planes crashed Tuesday in New York, Washington and Pennsylvania, prompting a nationwide shutdown of air travel that continued Wednesday.

"It just became clear as we went through the day yesterday that people weren't booking air travel," said Midway spokeswoman Karen Wing. "The calls just stopped in the travel center for reservations and the people who did call wanted a refund because they didn't want to be on an airplane for a little while."

The airline's primary hub, Raleigh-Durham International Airport, was closed to the public Wednesday. Calls to its managers were not immediately returned.

Midway accounts for about a third of the airport's traffic.

Refunds planned

Wing said workers were immediately sent home from the company's headquarters. About 100 employees will remain for a couple of weeks to shut down the company, and arrange refunds for ticketholders or rebook them onto other airlines.

At the time it declared bankruptcy, Midway served 28 destinations across the country with 74 aircraft.

Midway said it would begin returning aircraft to their lessors and will try to sell other assets to help pay debts.

"There's still money in the bank at this point," Wing said. "We really need to protect our employees and pay them their last wages, and do the right thing for our passengers."

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