Category Archives: Pinnacle Airlines

Pinnacle Airlines emerges from Chapter 11 bankruptcy reorganization as a Delta subsidiary

Pinnacle Airlines (Pinnacle Airlines Corporation) (Minneapolis/St. Paul) emerged from Chapter 11 bankruptcy protection and reorganization on May 1. The airline is now a subsidiary of Delta Air Lines (Atlanta). As previously reported, Pinnacle is moving to the Minneapolis/St. Paul hub. Delta is investing $52 million in the reorganized carrier.

Pinnacle filed for Chapter 11 on April 1, 2012 in the U.S. Bankruptcy Court for the Southern District of New York.

Read the full story from the Atlanta Journal-Constitution: CLICK HERE

Copyright Photo: Bruce Drum. Pinnacle will operate a large Bombardier CRJ900 fleet for Delta (eventually 92 aircraft). The smaller 50-seat CRJ200 fleet of 140 aircraft is being gradually phased out. Bombardier CRJ900 (CL-600-2D24) N147PQ (msn 15147) arrives at the Atlanta hub.

Pinnacle Airlines Corporation logo-1

Delta Connection-Pinnacle: AG Slide Show

 

Pinnacle Airlines to move its headquarters from Memphis to Minneapolis/St. Paul

Pinnacle Airlines Corporation logo-1

Pinnacle Airlines Corporation (Memphis) has announced its headquarters will relocate to Minnesota. The decision came after an exhaustive evaluation of the most cost-effective option as the Company emerges from Chapter 11. The present headquarters location in Memphis, Tennessee was also evaluated.

Pinnacle’s operation will be located in vacant space leased by Delta Air Lines on Minneapolis-St. Paul International Airport property.

Pinnacle presently occupies 170,000 square feet at One Commerce Square in downtown Memphis, which houses approximately 500 employees. Tentative plans call for the move to Minnesota to be completed by May 2013.

PAC is the holding company of Pinnacle Airlines (Memphis) and previously of Colgan Air (2nd) which was shut down in September 2012. Pinnacle Airlines now flies exclusively as a Delta Connection carrier. Since Memphis is a smaller hub for Delta, Pinnacle will have more work at Delta’s MSP larger hub.

The company was established in February 1985 as Express Airlines I and started a code sharing and feeder agreement with Republic Airlines in May 1985. Republic was the dominant carrier in Memphis.

Delta Connection-Pinnacle Airlines: AG Slide Show

The bankruptcy court approves Pinnacle’s path out of bankruptcy, Delta to invest

Pinnacle Airlines Corporation (Memphis) has announced that the comprehensive agreements it reached with Delta Air Lines (Atlanta), the Air Line Pilots Association, International (ALPA) and the Official Committee of Unsecured Creditors (Creditors’ Committee) in Pinnacle’s Chapter 11 cases have been approved by the Bankruptcy Court overseeing Pinnacle’s cases. The agreements together provide a path for the Company to emerge from bankruptcy with a competitive cost structure and a viable long-term business plan. Under Pinnacle’s new business plan, the Company will transition to operating a fleet of 81 fuel-efficient, two-class regional jets for Delta.

The comprehensive agreements include:

  • An amendment to the Company’s existing debtor-in-possession credit facility to provide Pinnacle with $30 million of additional liquidity to support its continued operation through emergence from Chapter 11 and an additional $22 million to fund certain required payments to Pinnacle’s pilots under a Bridge Agreement and related employer taxes. The amendment would also extend the maturity date for the credit facility from April 1 to May 15, 2013.
  • Amendments to the existing operating agreements with Delta that form the basis of the new business plan. Pinnacle will receive Delta Connection’s next 40 CRJ900 aircraft awarded, setting Pinnacle’s long-term fleet plan at 81 CRJ900 aircraft. The 40 additional CRJ900 aircraft deliveries are planned to begin in the fall of 2013 and are expected to be completed by year-end 2014. Pinnacle’s 140 CRJ200 aircraft will be removed from operation over the next two to three years.
  • A new collective bargaining agreement with Pinnacle’s pilots, as well as a bridge agreement that provides transitional payments, furlough benefits and specified career opportunities at Delta to Pinnacle’s pilots.
  • A restructuring support agreement among Pinnacle, Delta and the Creditors’ Committee setting forth certain principal terms for a plan of reorganization to emerge from Chapter 11. The reorganization plan will provide for Delta or an affiliate to acquire the equity in the reorganized Pinnacle Airlines Corporation after it emerges from bankruptcy. Pinnacle must file a plan of reorganization acceptable to Delta and the Creditors’ Committee by February 15, 2013.

Copyright Photo: Bruce Drum. Bombardier CRJ900 (CL-600-2D24) N161PQ (msn 15161) arrives at the Atlanta hub.

Delta Connection-Pinnacle Airlines: AG Slide Show

Pinnacle Airlines’ pilots ratify the restructuring contract

Pinnacle Airlines’ (Delta Connection) (Memphis) pilots, represented by the Air Line Pilots Association, Int’l (ALPA), today ratified a bankruptcy restructuring contract that was tentatively agreed to in December. With more than 86 percent of eligible pilots casting ballots, 85 percent of Pinnacle pilots voted in favor of the agreement.

The new seven-year agreement includes, among other cuts, a 9 percent reduction in pay for all pilots plus longevity caps to all pay scales which will further cut the pay of more than half of Pinnacle’s pilots by as much as another 16 percent. In addition to almost 25 percent pay cuts, the deal also increases health-care costs for all pilots while reducing pilot retirement benefits by more than 50 percent for Pinnacle’s most senior pilots. In recognition of the magnitude of the pilots’ concessions, the contract also includes a bridge agreement that provides a one-time longevity transition payment and guaranteed hiring for many Pinnacle pilots at Delta Air Lines. Pinnacle Airlines flies exclusively as a Delta Connection carrier and Delta will likely own Pinnacle as a result of having provided the financing that allowed Pinnacle to reorganize.

“Management failures are responsible for Pinnacle’s current financial crisis,” Capt. Wychor added, “but only this sacrifice by the pilots could preserve a future for the airline and its employees. In that future, we will seek out new employment opportunities for our pilots who no longer see a viable career path at Pinnacle while we protect and shore up the restructured contract for those who remain.”

The pilot-ratified contract will now be submitted to the Bankruptcy Court for the Southern District of New York for final approval.

Copyright Photo: Bruce Drum. Bombardier CRJ900 (CL-600-2D24) N146PQ 9msn 15146) of Pinnacle Airlines arrives at the Atlanta hub.

Delta Connection-Pinnacle Airlines: AG Slide Show

Pinnacle Airlines Corporation prepares to exit Chapter 11 with new agreements, will phase out its 140 CRJ200s in the next 2-3 years

Pinnacle Airline Corporation (Pinnacle Airlines) (Memphis) today issued the following statement:

Pinnacle Airlines Corporation announced today that it and its wholly owned subsidiaries have entered into comprehensive agreements that, among other things, provide a path forward for the Company to emerge from bankruptcy with a competitive cost structure and a viable long-term business plan. Under Pinnacle’s new business plan, the Company will transition its fleet to operate a fleet of 81 fuel-efficient, two-class regional jets for Delta Air Lines Inc.

The comprehensive agreements among Pinnacle, Delta, the Air Line Pilots Association, International (ALPA) and the Official Committee of Unsecured Creditors (Creditors’ Committee) in Pinnacle’s Chapter 11 cases include:

  • An amendment to the Company’s existing debtor-in-possession credit facility, to provide Pinnacle with $30 million of additional liquidity to support its continued operation through emergence from Chapter 11 and an additional $22 million to fund certain required payments to Pinnacle’s pilots under a Bridge Agreement and related employer taxes. The amendment would also extend the maturity date for the credit facility from April 1 to May 15, 2013.
  • Amendments to the existing operating agreements with Delta that form the basis of the new business plan. Pinnacle will receive Delta Connection’s next 40 Bombardier CRJ900 aircraft awarded, setting Pinnacle’s long-term fleet plan at 81 CRJ900 aircraft. The 40 additional CRJ900 aircraft deliveries are planned to begin in the fall of 2013 and are expected to be completed by year-end 2014. Pinnacle’s 140 Bombardier CRJ200 aircraft will be removed from operation over the next two to three years.
  • A Bridge Agreement that provides transitional payments, furlough benefits and specified career opportunities at Delta to Pinnacle’s pilots in conjunction with the recently negotiated letter of agreement between Pinnacle and ALPA.
  • A letter of agreement to amend Pinnacle’s collective bargaining agreement with the ALPA pilots. This letter of agreement and the Bridge Agreement are subject to ratification by the ALPA membership by Jan. 15, 2013.
  • A restructuring support agreement among Pinnacle, Delta and the Creditors’ Committee setting forth certain principal terms for a plan of reorganization to emerge from Chapter 11. The reorganization plan will provide for Delta or an affiliate to acquire the equity in the reorganized Pinnacle Airlines Corp. after it emerges from bankruptcy. Pinnacle must file a plan of reorganization acceptable to Delta and the Creditors’ Committee by February 15, 2013.

Pinnacle filed motions with the Bankruptcy Court seeking approval of the various components of the comprehensive agreements. All of the components of the comprehensive agreements are interdependent and are subject, among other things, to Court approval.

Copyright Photo: Fernandez Imaging. With the CRJ200s being retired, Pinnacle Airlines will concentrate on the larger CRJ900 in the future with its Delta Connection contract. Bombardier CRJ900 (CL-600-2D24) N176PQ (msn 15176) lands at Houston (Hobby).

Delta Connection-Pinnacle Airlines: AG Slide Show

Pinnacle Airlines reaches a tentative agreement with its ALPA pilots, will increase its Delta Connection Bombardier CRJ900 fleet to 81 aircraft

Pinnacle Airlines Corporation (Memphis) wholly owned subsidiary, Pinnacle Airlines Inc. (Memphis), has announced it has reached a tentative agreement with the Air Line Pilots Association (ALPA), the legal representative of the Pinnacle Airlines pilot group on cost reductions that cover pay, retirement, work rules and benefits.

A separate agreement was reached among Pinnacle Airlines, Pinnacle pilots and Delta Air Lines that includes long-term career opportunities and the addition of 40 Bombardier CRJ900s to the Pinnacle fleet. With this agreement, Pinnacle’s long-term fleet plan has been established at 81 CRJ900 aircraft. The CRJ900 deliveries are planned for the fall of 2013 and are planned to be completed by year-end of 2014. Pinnacle will remove its 140 CRJ200 aircraft from the fleet over the next two to three years.

ALPA members will have the opportunity to vote on the tentative agreement in January and, if approved, the changes would become effective when similar changes are implemented for Pinnacle’s other labor groups and non-union employees. The tentative agreement also remains subject to approval and review by the Bankruptcy Court.

Flying as a Delta Connection carrier, Pinnacle Airlines operates 197 regional jets on 1,000 daily flights to 131 cities in the United States and Canada.

Copyright Photo: Bruce Drum. Bombardier CRJ900 (CL-600-2D24) N181PQ (msn 15181) of Pinnacle Airlines arrives at Delta’s Atlanta hub.

Delta Connection-Pinnacle Airlines: AG Slide Show

Pinnacle Airlines reaches a tentative contract agreement with its flight attendants

Pinnacle Airlines Corporation’s (Memphis) wholly owned subsidiary, Pinnacle Airlines Inc. (Memphis), announced  it has reached a tentative agreement with the Association of Flight Attendants-CWA (AFA), the legal representative of the Pinnacle Airlines Flight Attendant group. Pinnacle is seeking concessions from all of its employees in order to emerge successfully from Chapter 11 proceedings with a competitive cost structure. The two sides reached a tentative agreement on concessions that cover pay, retirement, work rules and benefits. The concessions would become effective when concessions are implemented for other labor groups and non-union employees. AFA members at the airline will now have the opportunity to vote on the tentative agreement in the coming days and, if ratified, will avoid the Section 1113 litigation process in bankruptcy court.

The tentative agreement also remains subject to required corporate approvals and review by the Bankruptcy Court.

Copyright Photo: Bruce Drum. Pinnacle Airlines’ Bombardier CRJ200 (CL-600-2B19) N8918B (msn 7918) taxies at Charlotte.

Delta Connection-Pinnacle: