ATA Airlines files for bankruptcy, shuts down all operations
( dpa ) - US regional carrier ATA Airlines has filed for bankruptcy and shut down all operations after the cancellation of a crucial military charter deal, the company said in an unexpected announcement Thursday.
ATA said it filed for Chapter 11 protection in an Indiana court Wednesday and discontinued all services early Thursday morning. Virtually all of its 2,230 employees had been notified that they were out of a job.
The news comes as another blow to the island of Hawaii after carrier Aloha also filed for bankruptcy and ended passenger services on Monday. Indianapolis-based ATA ran routes to Hawaii from a number of West Coast cities.
ATA blamed the sudden move on surging fuel prices and an "abrupt and unexpected" cancellation of a contract with FedEx to conduct airlifts for the US military, which had made it impossible for the airline to continue operating. ATA said the agreement had been set to run until September 2009.
The airline, founded in 1973, said it serves about 10,000 customers per day on 29 aircraft.