Private equity-backed Midwest Air Group Inc.
said Monday it would cut 1,200 jobs, about 40% of its total, as it scrambles to bring down costs and avoid a bankruptcy filing.
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The airline, which struck a deal last August to be acquired by TPG Capital for $450 million, said the job reductions follow its previously announced decision to remove 12 less-efficient MD-80s from its fleet this fall. The cuts are spread throughout the airline, and will occur no later than mid-September.
"In order to successfully restructure, there is no way to avoid deep and painful reductions to our current work force," CEO Timothy E. Hoeksema said in a statement.
The cuts come as Midwest continues talks with unions representing its pilots and flight attendants on concessions that Midwest says are necessary for it to avoid bankruptcy. The airline has not detailed how much it needs from the group, but union sources say Midwest intends to eliminate half of its 400 pilot positions and wishes to reduce some wages by more than 50%.
Absent such cuts, Midwest could be forced to seek Chapter 11 protection as soon as this week, union sources say. - Lou Whiteman
See Midwest's statement
See Dealscape post on Midwest's fleet reductions
See Dealscape post detailing Midwest's talks with its unions
See Dealwatch: Airlines
Comments
It makes me sad, to see all these airlines suffering. Unprotected by high fuel prices, what can they do? I work for a company that manages and tracks frequent flier mile programs and I've been following the airline industry on savvywallet.com. One thing to consider are the millions of unredeemed miles. My advice? Spend them before the companies decide to ground all their planes and services.