The Memphis-based Pinnacle Airlines has been struggling to keep up flights around the Eastern part of the United States for a while. The regional airline carrier filed for bankruptcy on Monday, hoping to resolve its increasing debt problems and remain in operation.
Small Airline, Big Debts
Pinnacle Airlines Corp., currently offers regional service on smaller jets. Operating under contract for several other airlines including Delta, United, Continental and US Airways, Pinnacle hasn’t been able to resolve its $1.42 billion in debts. Flight cutbacks, costs saving measures and increased labor contracts from other airlines hasn’t been enough to keep Pinnacle afloat, who just reported another bleak financial quarter already this year.
Pinnacle reportedly lost close to $9 million in the first nine months of 2011, a near 50% decrease in profitability from the year prior. Bad press surrounding a Pinnacle jet crash in 2009 has also brought increased struggles to the company as they fight to maintain their reputation as a legitimate and safe regional carrier. However, as one of the largest regional airlines in the industry, Pinnacle has kept up with its major competitor, American Eagle. With Pinnacle’s competitor also working through a Chapter 11 filing, Pinnacle executives are optimistic that they will be able to restructure and rebound in the near future.