If a carrier gores bankrupt....

Old Apr 14th, 2004, 01:57 PM
  #1  
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If a carrier gores bankrupt....

If a major carrier goes into bankruptcy, what happens to my pre-paid flight reservations? What happens to my skymiles?
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Old Apr 14th, 2004, 02:01 PM
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I think as long as they stay in business you are okay. If they completely stop their operations, you will probably lose your flight and miles. When Vanguard (based here in KC) went out of business, I knew a lot of people that were just out of luck with their tickets.
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Old Apr 14th, 2004, 02:03 PM
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Bankrupt will bleed if he gets gored!!
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Old Apr 14th, 2004, 02:04 PM
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Depends on the route and the type of bankruptcy. The carrier will probably enter Chapter 11 proceedings, allowing it to stay in operation while it reorganizes. Routes may be sold off (or eliminated) gradually, but as long as you have proof of purchase, you should be covered by typical consumer protection laws. I haven't gone through this myself, but I think they do have an obligation to accomodate you somehow.

Those frequent flyer miles, however, are another thing-- a perk, not a real "obligation" of any sort on Delta's part (and I assume you're worried about Delta). If you read the fine print in your SkyMiles statement, there is probably language stating that "Delta reserves the right to terminate its frequent flyer program at any time"-- or something like that. Although I'd be surprised if they eliminate the miles entirely (a sure way to cheese off their regular customers), they may make it even harder to redeem them.
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Old Apr 14th, 2004, 02:09 PM
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Let me add, though...if for some reason the carrier will not reimburse you for your tickets, as long as you charged them on your credit card you should be able to get the money back from your CC company.
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Old Apr 14th, 2004, 02:13 PM
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DELTA in trouble? I had not heard it was that bad. Delta is the main carrier I have used for years. Wow, well, after 9/11 all the airlines have suffered badly, as does now... the flying public. Wouldn't it be nice to be able to go back to a pre-9/11 world?
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Old Apr 14th, 2004, 02:51 PM
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Delta is losing a lot of money, but it also has lots of cash and credit line, so it'll not liquidate or shutdown. In N. America alone, there are 3 other major airlines in worse shape - USAir, Air Canada, and UA.

You'll going to hear a lot of negative talk about Delta from its own management in the coming week because they're trying to negotiate with their pilots, who are earning the highest pay among all carriers in the US.
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Old Apr 14th, 2004, 03:38 PM
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My cousin is a pilot for Delta. From talking to him it sounds like an ongoing post-9/11 problem that will be resolved. They may go bankrupt but they should keep flying.
 
Old Apr 14th, 2004, 03:55 PM
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uuhhhh
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my thought exactly, atilla
 
Old Apr 14th, 2004, 08:45 PM
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Good point rkkwan.
You are right, I think. The article I read was in the Wall Street Journal. It reported that Delta wah lost something like $39 million last quarter, despite an upswing in pre-bookings. It ALSO, made mention that Delta was saying that in order to avoid bankruptcy, they would have to have concessions from the pilots...the highest paid in the industry...it said.

Ok, now it is in better perspective. I bet we will, indeed be hearing more negative things from mgmt.....but no word of mgmt. cuts or cancelled bonuses....such is business in the world today.
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Old Apr 14th, 2004, 09:09 PM
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If they go into Chapter 11 bankrupty (reorganization) you will be fine. on the other hand if it's Chapter 7 bankruptcy (liquidation) then you will be out of luck.
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Old Apr 15th, 2004, 05:01 AM
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The airline is NOT under an obligation to reimburse you for your tickets if they file bankruptcy and you paid cash. If you paid with a credit card, under the Fair Credit Billing Act you are entitled to a refund if you pay for services that cannot be provided.

But, if the airline filed for Chapter 11, they will likely still be operating and will simply honor your ticket and you are not entitled to a refund.

If they stop flying or stop flying your route, the DOT manadated in August 2002 that other airlines must honor the tickets, subject to a feee of up to $25 and that you rebook WITHIN 60 days. The last part is important because it is based on the day they file, NOT the day of your flight.

If you have miles, the generally will keep the programs because their intent is to remain flying after bankruptcy. But, FF programs are a customer accomodation and not a contract so they can cancel or do whatever they please with those programs.
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Old Apr 15th, 2004, 05:23 AM
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I have no experience with skymiles, but when TWA went bankrupt they honored our Aviator(TWA frequent flyer miles) and eventually even the TWA frequent flyer miles we did not use got transferred to American Airlines (Aadvantage FF miles) who absorbed bankrupt TWA.
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Old Apr 15th, 2004, 05:28 AM
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What is USAir's status as of today (4/15)?
 
Old Apr 15th, 2004, 06:18 AM
  #15  
Dan
 
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All flights are ontime!

Seriously, who knows about USAirways. They are in a precarious situation, for sure, but I suspect they will tweak labor contracts, contract a bit, etc to survive.
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Old Apr 15th, 2004, 08:29 AM
  #16  
kkj
 
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Check out the airline section on the forum. You will see that your question has been answered several times.
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