Senior Kris Olsen, like many other students, has already made plans to travel home to New York for Thanksgiving break. But he wonders if his flight will even get off the ground because he's flying with ATA.\n"I've used them the last couple of vacations because (ATA) has the bigger jets," Oslen said. "I will definitely not use them anymore now that they have gone bankrupt." \nATA Holdings Corp., and certain subsidiaries, including ATA Airlines Inc., filed for protection under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Indiana Tuesday. The nation's 10th largest passenger carrier will undergo "reorganization to address its debt levels and other obligations, and to lower its cost structure even further, while operating in the normal course of business," according to a statement from ATA. \nDuring a bankruptcy case, a company typically tries to get rid of underperforming assets and restructure around its core strengths, said ATA's Bankruptcy Attorney Michael O'Neil.\n"ATA has the exclusive right to file a plan of reorganization during the first 120 days of its case, and that 'exclusivity period' can be extended by court order," O'Neil said. "The timing of emergence from bankruptcy is impossible to predict, being just a few days into the Chapter 11 case."\nA statement from ATA gave several ambitions the company wishes to maintain during the bankruptcy. ATA hopes to maintain flight schedules, operations, customer service and travel rewards programs, enter into agreements with AirTran Airways, Inc. to operate and acquire routes at Chicago Midway, Ronald Reagan Washington National and LaGuardia Airports, and to have Indianapolis remain ATA's headquarters and primary hub.\nIU School of Public and Environmental Affairs Professor Clint Oster specializes in airline industry economics and aviation safety and said he believes there are certain reasons why ATA is in the position they are in.\nOster said when the economy collapsed after Sept. 11, 2003, ATA found itself struggling and perhaps heading toward bankruptcy, with payments coming up for aircrafts they bought pre-Sept. 11.\n"In the case of ATA, they have some special things that happened that certainly made their life more difficult," Oster said. "They carry quite a few passengers to Florida, and since the hurricanes hit Florida, it would decimate that market quite a bit. The second thing for ATA (was) they made a decision to purchase a larger number of new jets. The economy was doing really well then, and it was a reasonable decision." \nThough O'Neil said he doesn't know specifically why ATA went into bankruptcy there are some issues plaguing the entire airline industry.\n"In the airline industry as a whole, however, the two toughest problems are brutally high fuel costs and brutally low ticket prices," O'Neil said. \nThis is not the first major airline to file for Chapter 11 bankruptcy.\nAll majors airlines other than American Airlines and Delta have, at one time or another, filed for Chapter 11 bankruptcy. \nOster said for students currently purchasing or who have purchased tickets from ATA, there are some things they need to do.\n"Continue to pay attention to what's happening," Oster said. "If I hadn't paid for the ticket yet, I would pay for it with a credit card. I would continue to check and see if the airline is still going to fly that flight, but if anyone has tickets on ATA in the next weeks, I wouldn't be that concerned about them."\nATA will remain in Indianapolis, the city they have called home since 1973, according to a statement from ATA.\n"We have begun taking the difficult steps to transform ATA into an airline that is positioned to meet the needs of our customers today and for the future," said ATA Holdings' Chairman, President and Chief Executive Officer George Mikelsons in a statement. "Our agreements with AirTran, combined with ATSB's flexibility, will facilitate ATA's transformation into a formidable low-fare competitor capable of winning in today's airline industry environment for our customers, employees, creditors and other stakeholders."\n-- Contact senior writer Mike Malik at mjmalik@indiana.edu.
ATA bankruptcy could ground traveling IU students
Professor: Airline could stop flights in face of financial woes
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