Delta Airlines, Inc. Bankruptcy

Delta Air Lines, Inc. Bankruptcy

Background

Delta Air Lines, Inc. has been an active passenger airline within the United States for a very long time. “Delta Air Lines, Inc. has been in operation since 1928. This U.S. airline was first begun and headquartered in Monroe, Louisiana. In 1941, Delta Air Lines, Inc. moved its base and headquarters to Atlanta, Georgia. In 2010, this airline was considered one of the world’s largest airlines in terms of passenger traffic and fleet size. Delta Air Lines has operated within an extensive domestic and international network. This network has a span of North America, South America, Europe, Asia, Africa, the Middle East, the Caribbean and Australia” (Ross, 2010). In 2005, “Delta Air Lines, Inc. was ranked number 3 among U.S. airline carriers. This airline company had at the time 60,000 employees, 1,873 daily flights, 528 aircraft and flew approximately 340,000 passengers daily” (Isidore, 2005). Delta has not always seen great profits from this extensive network. The company itself has had many financial difficulties, between 911, jet fuel prices rising and labor issues, Delta Air Lines faced some pretty difficult times. Trying to boost profit and eliminate heavy debt, “Delta eliminates roughly 16,000 jobs, this equates to 21 percent of its work force over the three year period of 2001-2003. In 2003, Delta announces pay cuts for top executives. In 2003, negotiations with Delta’s pilots begins, proposals of 22 percent pay cut and canceling of pilot pay raises go to the union. In 2004, Delta vows to cut 7,000 more jobs over 18-month period and will eliminate the Dallas-Fort Worth hub. Early 2005, Delta’s CEO states in a memo that the current transformation plan, is not enough to save the struggling airline” (Weber, 2007). “In 2004, the company tried to avoid bankruptcy by restructuring the company with numerous job cuts and expansion plans. Unfortunately, this plan did not work and in September 2005, Delta Air Lines, Inc....