US regional Pinnacle faces financial difficulties, seeks to rework contracts
Published: December 9, 2011
Pinnacle Airlines Corp., the Memphis-based parent of regionals Pinnacle Airlines, Colgan Air and Mesaba Aviation, said Thursday it has serious financial issues it must address and will initiate a “comprehensive program to reduce short- and long-term costs and enhance liquidity.”
It will be “seeking modifications to the company’s agreements with mainline airline partners, equipment lessors, debt holders, real property lessors and vendors.” Pinnacle’s regional affiliates operate under capacity purchase agreements as Delta Connection, United Express and US Airways Express.
In addition to reworking outside agreements, the company said it will seek concessions from pilots and other employees. “Pinnacle Airlines Corp. is facing a convergence of events that, if left unaddressed, will make 2012 an extremely challenging year,” president and CEO Sean Menke said in a statement. “We have a great deal of hard work ahead of us, but these efforts are necessary to ensure we can operate as a profitable business for our shareholders, mainline flying partners, employees and other stakeholders.”
Pinnacle incurred a $ 3.5 million net loss in the third quarter (ATW Daily News, Nov. 10).