Frontier Airlines files for bankruptcy

[thelakelander]

CATHERINE TSAI
AP Business Writer

DENVER â€" Frontier Airlines Holdings Inc. has filed for Chapter 11 bankruptcy protection, but unlike other airlines filing for bankruptcy in recent weeks, it plans to keep running while it reorganizes.

The low-fare carrier said its filing Friday came after an unexpected attempt by its principal credit card processor to start withholding significant proceeds from the sale of Frontier tickets, which threatened to hurt Frontier's liquidity.

The Chapter 11 filing in U.S. Bankruptcy Court in New York prevents the credit card processor from increasing its "holdback," Frontier CEO Sean Menke said.

"By filing for Chapter 11, we will now have the time and legal protection necessary to obtain additional financing and enhance our liquidity. Fortunately, we believe that we currently have adequate cash on hand to meet our operating needs while we take steps to further strengthen our company," Menke said in a statement.

Frontier, whose major hub is in Denver, has been affected as other airlines have by rising fuel costs and the credit crisis in financial markets.

ATA Airlines, Skybus and Aloha Airgroup all have filed for bankruptcy recently, but Menke said Frontier's reasons for doing so were different.

full article: http://wire.jacksonville.com/pstories/business/20080411/267376470.shtml

[DetroitInJAX]

Considering they are getting their brains beat out in the three way battle for Denver (Southwest, Frontier, United), Im surprised they lasted this long.  Compared to the other two airlines, they dont have very deep pockets.


Just remember folks, that Jacksonville service is going seasonal.  Fly on it while you can before its gone.

[reednavy]

They filed for Ch. 11 Protection, they are not going under like the 3 mentioned above. I think they will stay alive, its just tough times for all airlines, not just Frontier. Southwest's fuel bill this year could equal or exceed their 2007 profits, over $3 billion!