US cargo airline Southern Air today filed for bankruptcy protection but its four B777 freightersare continuing to operate intercontinental flights normally for DHL Express.
The privately-owned cargo carrier has a current fleet of four new B777s, four B747-400s andthree ageing B747-200s. The B777s operate DHL-dedicated round-the-world flights from Cincinnati viaLeipzig and Bahrain to Hong Kong and on to Cincinnati, and from Hong Kong via Los Angeles andLeipzig back to Hong Kong. The B747s operate for other customers, including the US military.
Southern Air filed for Chapter 11 protection at the US bankruptcy court, District of Delaware,citing a “rapidly deteriorating” financial situation due to cutbacks in military contracts. Theairline said it needed to restructure secured debt and certain lease obligations, according to aReuters report.
The company, headed by Dan McHugh, a former DHL Express executive, highlighted in a pressrelease the impact of “economic challenges and extreme industry changes”, including major cutbacksby the US Department of Defense, but claimed it had been making “good progress” in becoming aprovider for global customers.
“The next component of our transformation is the restructuring of our corporate debt and othercosts associated with our acquisition in 2007. With an improved balance sheet, Southern Air willhave a greater capacity to move forward as a global air cargo industry leader on a financiallystronger and more competitive foundation for the long term,” it stated.
“Southern Air remains open for business as usual, and fully expects to continue normal businessoperations, fulfilling all customer requirements as scheduled and providing uninterrupted highquality air cargo services,” the company emphasised.
A DHL Express spokesman told CEP-Research: “There is no impact on DHL operations. Their flightoperations have not been affected.”
Financial investor Oak Hill Capital last year injected $55 million into Southern Air to financeits fleet renewal and growth plans.
