Help! NWA bankruptcy?

[PamelaNiebergal]

I am freaking out. First of all let me say that I know next to nothing about the airline industry so if anything I say is uninformed feel free to let me know. I booked my flights from Canada to WDW for next May directly through NWA. I always like to plan in advance, plus this saves me money. Well, now due to a strike and skyrocketing jet fuel prices I hear that NWA may be filing for bankruptcy. What should I do? Should I try to cancel my flights? Will I be compensated the $1400 if something does happen? Any advice would be greatly appreciated.

 

[HauntedPirate]

I live in MN, where one of NWA's major hubs is, so we hear about them every day right now.

I would not panic at this point. Even if they file for bankruptcy, it doesn't mean that flights will be cancelled. If they don't honor your tickets, then I believe you have some legal basis for compensation. For now, I'd sit tight.

 

[Thrawn]

Bankruptcy in the airline industry doesn't mean much. Just protects the carriers from lawsuits. Don't worry about it, they won't just declare bankruptcy and shut down. They would declare, and operate as normal for a while, and maybe in a year or two shut down.

 

[PamelaNiebergal]

Thank-you. I feel much better already, this is just what I needed to hear.

 

[SteveUK]

As has already been mentioned, bankruptcy in the airline industry is not as simple or uncommon as you may think. I worked for several years in an airport and have experience of airlines going bankrupt owing us money, and believe me it is not as simple as you would think. It may be complicated from the industry side of things, but you find that almost invariably there are measures in place to protect the consumer and most passengers will continue with their journeys and never know anything changed.

As has already been suggested - just sit tight and dont panic. If you are looking for a refund from a company that has already filed for bankruptcy, then you will get nowhere. If you hang on with valid bookings, speaking from experience, I honestly believe that somebody will step in to make sure your bookings are honoured.

 

[SpenceMan01]

I live in MN, where one of NWA's major hubs is, so we hear about them every day right now.

Right, but we're the HOME of NWA, not just a major hub. Don't you just love hearing "Tonight on Fox 9 news at 9: Day 50 bazillion in the standoff between NWA and its mechanics..." :hurl:

 

[goofyfan13]

Right, but we're the HOME of NWA, not just a major hub. Don't you just love hearing "Tonight on Fox 9 news at 9: Day 50 bazillion in the standoff between NWA and its mechanics..." :hurl:

It was the same in Detroit before I left, it's probobly not as bad as you guys got it, but since we're the second biggest hub we still get it pretty bad. Local radio, Newspapers, TV, it was major news everwhere...It's one reason I'm glad I'm back at school in Daytona, don't have to hear about the Mechanics Union and NWA every day... :lol:

 

[tigsmom]

Should they totally go out of business you do have recourse. You can file for a refund. Thats what happened when SouthEast went out of business.
Of course, it won't be immediate.

 

[Mystic]

Air Canada was under bankruptcy protection for almost 2 years and they continued to fly without incident the entire time. As long as they airline doesn't shut down completely you should be fine.

 

[bgraham34]

Your Worried I have almost 500k in skymiles for Delta. I will be so screwed. All those Miles. My god. All these trips I had planned can be gone. Ok so its no where near losing your home in the gulf. But it still could be my own personal tragedy.

 

[MSTINKHERBELL01]

I work for a major credit card company and rumors of if and when "another" airline carrier files bankruptsy is def. in the air these days. Know that even if and or when such a thing happens it doesnt mean that they won't fly. Perhaps a reduced flight schedule...if that. I wouldnt panic just yet and communicate with the airline when and if this occurs to understand better.

 

[LaughingGravy]

Your Worried I have almost 500k in skymiles for Delta. I will be so screwed. All those Miles. My god. All these trips I had planned can be gone. Ok so its no where near losing your home in the gulf. But it still could be my own personal tragedy.

I'd see what you may be able to get in merchandise now if traveling is not feasable. At least investigate it.

 

[AndyP]

Your Worried I have almost 500k in skymiles for Delta. I will be so screwed. All those Miles. My god. All these trips I had planned can be gone. Ok so its no where near losing your home in the gulf. But it still could be my own personal tragedy.

Oh dear! I was about to mention about Delta too! Such a shame, we thought it was such a great airline when we flew with them, 9/11 really hit Delta hard, like $50 loss per share! Such is the industry

 

[DragonJay]

While I wouldn't worry too much about the bankruptcy in the timeframe you suggested, if they do go down completely, you would be 100% out of luck. Other carriers won't honour the tickets (they didn't get paid), and you are well down the list of creditors (who fight to get 10% on the dollar).

You mentioned being from Canada, like myself. Look what happened when JetsGo went down. But they were so badly off, they had to ground immediately. At least NWA is in a similar position to AC was, and they're doing fine now (after getting enough court protection to re-negotiate every major contract, and hammering the common shareholders).

 

[brich]

Found this. Don't let it alarm you. It does have interesting views. It does say it was recently updated but I see things that are out of date.
http://www.hasbrouck.org/articles/bankruptcy.html

I somewhat work in the industry. I see top execs from the different major carriers in my office all the time. They are shopping for ways to cut costs and are spending pretty good money to do this. I wouldn't worry to much that you'll be without a flight. United's been in bankruptcy for quiet a while now, looking to emerge. Hawaiian Airlines just emerged from their bankruptcy protection and are in great shape. These past few years have been extremely difficult for the airlines but they are making concerted efforts to stay alive. Take a deep breath. I'm sure things will be fine.

 

[SANDKRUSER]

I, too, live in Minnesota and have Northwest flights for our trip in October, so I've been biting my nails ever since the mechanics went on strike. I've been more worried about the quality of work on the planes than the threat of bankruptcy.

This morning on the news - they said NWA will more than likely file in the next couple of days if they're going to - but they had a travel "advisor" on there that said that if you have existing tickets - don't worry - they'll be honored - even the World Perks flights (of three, one of my tickets is an award flight). I had a flight booked on United in 2002 (or 2003) and they filed bankruptcy - it didn't do anything to my flights - they went off as scheduled. All it means is that they are in a position to reorganize (the President can make the mechanics go back to work - at a lesser rate, of course), and the assets will not diminish. Some of the flight times may be changed but the flights will still be there.

 

[brich]

Look what happened when JetsGo went down. But they were so badly off, they had to ground immediately. At least NWA is in a similar position to AC was, and they're doing fine now (after getting enough court protection to re-negotiate every major contract, and hammering the common shareholders).

JetsGo is by far the exception. Not often you see this happen... Plus, NWA is a tad bigger than JetsGo was....

 

[brich]

Plus, didn't I hear that there we're to be considerable changes to the bankruptcy laws happening sometime in October? Changes that would mean no guarantee that protection would cover 100% of the defaulted debt. You would still be liable to pay some of your debt outside of that covered by bankruptcy protection. This in itself may force bankruptcy claims to be filed sooner than to wait for the changes to occur. Otherwise, NWA may have been able to postpone their claim. And I also wonder if their dispute with the mechanics union has any role in NWA's publicizing of their threat to file... :veryconfu

 

[HauntedPirate]

NWA is definitely looking to get any upper hand they can with the Mechanics Union. But the bankruptcy filing is anything but surprising - they have the highest labor costs in the industry. Take the decline in air travel since 9/11, add in high exec pay (who never seem to "share the pain" they take about....), the fact that they expect their fuel costs to go from their planned $2.2billion to $3.3billion this year, and it's all a formula for what's currently going on.

 

[SpenceMan01]

I've been more worried about the quality of work on the planes than the threat of bankruptcy.

I wouldn't be. Despite what the unions would want you to believe the replacement mechanics are just as qualified as the 'regular' ones. (I say 'regular' because it seems like they strike every few years and if it keeps up will the replacements become the regulars?) Don't buy into the scare tactics, you'll be just fine. Actually, I'd've beenmore worried that a disgruntled mechanic would have done something right before they went on strike, though even the chances of that are slim.