727LOVER From United States of America, joined Oct 2001, 5722 posts, RR: 20 Posted (7 years 3 months 15 hours ago) and read 1460 times:
If I have my date correct, today, February 24 marks the 20th anniversary of Texas Air Corp's announcent that it would purchase Eastern Air Lines. This has to go down as one of the most boneheaded moves ever in aviation. I believe that Eastern would be here today, if Frank Borman had put Eastern in Ch. 11 instead of selling to Frank Lorenzo. They could have reorganized, shed debt, and emerged a healthier carrier with competivite costs, well before the other majors would have addressed the cost issue. Someone has to help me, but if I understand correctly, the pilots and F/As had agreed to concessions, but the IAM was holding out. How ironic, Charlie Bryan was the reason Lorenzo arrived on property in the first place. The selling price was very low, a steal, for Lorenzo, and didn't Eastern put up cash for its own buyout?????!!!!!
Kellmark From United States of America, joined Dec 2000, 670 posts, RR: 8 Reply 1, posted (7 years 3 months 14 hours ago) and read 1425 times:
I totally agree with everything above. Charlie Bryan said he would rather take his chances with Lorenzo than work with Borman. He was sure wrong about that one.
I understand that the reason that Eastern didn't file for Chapter 11 then, was they believed that they didn't have enough cash to see them through.
But you have to wonder about all of the thinking behind that whole Lorenzo deal. Of course Borman got to keep a salary for quite a while for not doing much of anything. But it destroyed his future career as well.
Borman was ineffective in dealing with the unions and the unions, especially the IAM, were willing to let the company die. It was the "perfect storm" for the rest of the employees, as they all lost their jobs and the customers went elsewhere.
WDBRR From United States of America, joined Jan 2005, 604 posts, RR: 0 Reply 2, posted (7 years 3 months 12 hours ago) and read 1376 times:
Yes, Eastern was sold for around $365 million dollars, Lorenzo stated at the time that he was an "airline builder".....he sure was, he tranferred some of the most valuable assets from Eastern to Continental. Contintental dumped their "Sonic" CRS and today use a form of SystemOne that has a different name, even most of the formats are from SystemOne. Eastern shut down on 01/18/91...in less than five years, they went from one of the largest airlines in the free world to nothing. glad I had a chance to work for them, many fond memories.
Kkfla737 From United States of America, joined Oct 2004, 1033 posts, RR: 1 Reply 3, posted (7 years 2 months 4 weeks 1 day 23 hours ago) and read 1271 times:
A sad and dubious anniversary. Then again, Eastern was at the brink of collapse in early 1986 despite being closer to Frank Borman's desire for critical mass in its route structure than anytime in the past or in the gloomy future.
Jetdeltamsy From United States of America, joined Nov 2000, 2984 posts, RR: 8 Reply 4, posted (7 years 2 months 4 weeks 1 day 19 hours ago) and read 1189 times:
Quoting 727LOVER (Thread starter): if Frank Borman had put Eastern in Ch. 11 instead of selling to Frank Lorenzo. They could have reorganized, shed debt, and emerged a healthier carrier with competivite costs, well before the other majors would have addressed the cost issue.
I don't know if i agree with that or not.
I worked for Eastern for eleven years until the shutdown. I was a very "militant" flight attendant...actually i was young and stupid and didn't think for myself...much like the rest of the union employees at Eastern.
If Borman had taken us into bankruptcy, I'm not sure how successful we would have been.
At that time, there was no "blueprint" for airline bankruptcies as there is today. It is now clear what costs have to be reduced or eliminated in bankruptcy. If we had filed and reorganized in 1991, Eastern would have been chartering relatively new territory. It is unlikely that wages and benefits would have been reduced to the level we are seeing now in airline bankruptcies. Eastern would have been saddled with a huge fleet of very old aircraft without the money to modernize. Sure we had the 757's and L1011's, but relatively few in number. The workhorse DC9's and 727's were coming to the end of their lifecycles. Today's bankrupt carriers tend to have more modern fleets (except for NW) that they are able to hang onto through the bankruptcy process.
If I could go back and change the past, I would give anything to still be working for Eastern. We were well paid and it was a fun and exciting place to work. But the economy and the airline industry has changed so much, I don't know that we could have ever accepted the necessary changes to make the company a success.
Worked for too many airlines to list. Banktupcy after bankruptcy after bankruptcy.
Clipper002 From United States of America, joined Aug 2004, 671 posts, RR: 14 Reply 5, posted (7 years 2 months 4 weeks 1 day 15 hours ago) and read 1134 times:
Thanks very much for an extremely candid reply. I think you hit the nail right on the head. The industry today is nothing like it was back in '91. You seem to have gotten both feet back on the ground with your career and I wish you only the best of luck going forward.