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Delta Helped Pan Am Before Demise?  
User currently offlinePacificflyer From United States of America, joined Nov 2001, 382 posts, RR: 0
Posted (12 years 5 months 2 weeks 5 days 1 hour ago) and read 1654 times:

I heard it from many places and none of them was clear to me. The last years of Pan Am, back in 1991, was Delta helping Pan Am to stay in the air but let it go at the end in December of that year? It seemed like Delta had something to do with Pan Am during the last year but I am not sure what. Besides the fact that Delta inherited most of Pan Am's European routes.

9 replies: All unread, jump to last
 
User currently offlineHoffa From , joined Dec 1969, posts, RR:
Reply 1, posted (12 years 5 months 2 weeks 5 days 1 hour ago) and read 1622 times:

Ha Ha! Best joke I've heard all day.

Delta promised Pan Am they were going to buy their European routes, planes, equipment, offices, etc but instead reneged and just bought it all at the bankruptcy fire sale when Pan Am went under.


User currently offlinePacificflyer From United States of America, joined Nov 2001, 382 posts, RR: 0
Reply 2, posted (12 years 5 months 2 weeks 5 days 1 hour ago) and read 1615 times:

Hmm...so is that what it's all about? Maybe it was a joke to you but I wasn't sure that's why I ask. Maybe you could tell me more about the situation. Thanks in advance!

User currently onlineSTT757 From United States of America, joined Mar 2000, 16829 posts, RR: 51
Reply 3, posted (12 years 5 months 2 weeks 5 days ago) and read 1591 times:

No what happened was DL did buy PA's European routes and A-310 aircraft, as part of the deal they gave PA a promise of support while PA rebuilt themselves as a carrier based out of MIA serving Latin America and the Carribean from JFK and MIA (as well as Europe from MIA).

However for one reason or another after a few months of DL owning the European network and PA working out of MIA PA needed a cash influx to help survive the recession, DL reneged on their promise to keep PA afloat and let PA liquadate in bankruptcy court where UAl picked up PA's Latin America routes for almost nothing ($100 million).



Eastern Air lines flt # 701, EWR-MCO Boeing 757
User currently offlineAA717driver From United States of America, joined Feb 2002, 1566 posts, RR: 13
Reply 4, posted (12 years 5 months 2 weeks 4 days 23 hours ago) and read 1567 times:

Yeah, DAL helped PAA--like Iraq helped Kuwait in '90...


FL450, M.85
User currently offlineFleet service From United States of America, joined Apr 2000, 622 posts, RR: 2
Reply 5, posted (12 years 5 months 2 weeks 4 days 21 hours ago) and read 1533 times:


Delta was providing Debtor in Possesion financing,Pan Am tore through about $180 million dollars in a month,then went back to Delta looking for more money.

It was at that point that Delta came to the decision that any further investment in Pan Am was not viable,and withheld any further money.


With no cash,Pan Am ceased operations on 04 December 1991.

Delta hired about 7,500 Pan Am employees,the rest went down with the ship.

Most former Pan Am employees feel Delta had no real intention of any further investment in the company and was merely "Cherry Picking" the few remaining assets of any value.Those being the North Atlantic operation, the hub at FRA,the Shuttle and the Worldport at JFK.


Selling the Pacific division and the precious LHR rights to United in 1986 and 1988 set the stage for this less than glorious ending to what once was viewed as the unofficial flag carrier of the United States.


Pan Am,the airline that made United great.

Think about that,where would United be without Pan Am's Pacific operation and LHR rights?





Yes, I actually *do* work for an airline,how about you?
User currently offlineClipper471 From United States of America, joined Jan 2002, 726 posts, RR: 0
Reply 6, posted (12 years 5 months 2 weeks 4 days 8 hours ago) and read 1497 times:
AIRLINERS.NET CREW
DATABASE EDITOR

Fleet service, the beginning of the end was when they bought too many 747's, 25 plus 8 more ordered by Najeeb Halaby. They were flown during the oil crisis, sometimes with only a handful of passengers. The next blow came in 1980 when they overpaid for National Airlines. It would have been much cheaper to begin a domestic network themselves. They also would have avoided many union problems had they not integrated National Airlines into the largely veteran Pan Am pilot base.

As for the LHR routes, these were sold in 1990 and transferred in April-1991, not 1988. The original agreement:

23 October 1990 - Pan Am announced it would sell its flagship routes between the U.S. and London (Heathrow) to United Airlines and two jumbo jets for about $400 million. The routes were London (Heathrow) to Los Angeles, New York, San Francisco, Seattle, and Washington, DC; London to continental European cities including Amsterdam, Berlin, Brussels, Hamburg, Helsinki, Munich and Oslo. Pan Am kept routes between London and Detroit and Miami (to be flown to Gatwick). United also would aquire Pan Am's route between Washington (Dulles) and Paris as part of the deal as well as agreeing to pay up to $100 million worth of Pan Am tickets should Pan Am stop flying. The acquisition was to include two Boeing 747-200 widebody aircraft built for long-range flight. A marketing agreement was to bring United's MileagePlus frequent-flyer program together with WorldPass.

Pan Am was the leading trans-Atlantic carrier with 14.1% of the market. TWA had 11.8%, British Airways PLC had 11.1%, Lufthansa had 6.8%, American Airlines Inc. had 5.5%, KLM Royal Dutch Airlines had 5.2%, Air France had 3.6% and Delta Air Lines Inc. had 3.5%.

11 November 1990 - Trans World Airlines proposed buying Pan Am Corp. for $450 million in cash and securities. The deal was contingent on Pan Am backing out of the U.S.-London routes sold to United Airlines.

24 December 1990 - Pan Am Corp. received a $20 million cash infusion from United Airlines in an advance payment as part of a larger $400 million sale agreement for U.S.-London routes and other assets.

08 January 1991 - Pan Am Corp. filed for Chapter 11 Bankruptcy Court protection in New York. Reasons cited were Pan Am 103, skyrocketing fuel prices since the August 2 Iraqi invasion of Kuwait, and the recession.

10 January 1991 - U.S. Bankruptcy Court approved Pan Am Corp.'s sale of key London routes to United Airlines and a related financing package that will give Pan Am $150 million. Final approval is dependent on British approval.

11 March 1991 - Britain's Department of Transport approves the transfer of Pan Am's London (Heathrow) routes to United.

British Airways holds the greatest share of the British-American market, with 39%. Pan Am had 15%, TWA 14% and Virgin Atlantic 7%.

01 April 1991 - United Airlines and Northwest Airlines receive emergency approval from the U.S. Department of Transportation to begin temporary flights between Miami and London (Heathrow) and Detroit and London (Gatwick), respectively. Northwest later drops plans to fly the Detroit to London route citing that it can't make money serving the route only until May 23, when Pan Am reclaims the route.

03 April 1991 - Pan Am transfers its London-Heathrow authority to United Airlines and also enters into a major marketing agreement with United.

07 May 1991 - Pan Am announced it will resume service on the Miami-London route on May 18 and the Detroit-London route on May 23. Pan Am will fly to London-Gatwick. Pan Am leased the Miami route to United Airlines on April 3 to allow United to offer Miami-London (Heathrow) service while reviewing the possibility of further cooperation with Pan Am.


User currently offlineFleet service From United States of America, joined Apr 2000, 622 posts, RR: 2
Reply 7, posted (12 years 5 months 2 weeks 4 days 7 hours ago) and read 1473 times:

Thanks for the correct dates.

You could also make a case for ordering L-1011's when there was a perfectly good DC-10 fleet from National already on the property.


A shame really.





Yes, I actually *do* work for an airline,how about you?
User currently offlineHeavymetal From , joined Dec 1969, posts, RR:
Reply 8, posted (12 years 5 months 2 weeks 4 days 7 hours ago) and read 1468 times:

Pan Am is a case study in how no company is infallible.

By the time Delta was picking over the carcass, the Pan Am execs were good for nothing more than figuring out how to get into their own golden parachutes.

The story of the fall of Pan Am should be required reading in the head offices of United....General Motors......even Microsoft.


User currently offlineClipper471 From United States of America, joined Jan 2002, 726 posts, RR: 0
Reply 9, posted (12 years 5 months 2 weeks 4 days 5 hours ago) and read 1459 times:
AIRLINERS.NET CREW
DATABASE EDITOR

Fleet service, the L-1011's didn't fit when they entered service as you pointed out. However, these were ordered 04-Apr-1978, almost two full years before the National acquisition, and less than a year before deregulation. The original intent was to replace aging Boeing 707's.

The 15 National DC-10's were later absorbed into the fleet Jan-1980. A 16th DC-10 was delivered new to Pan Am - one of National's order that was originally not taken.

Pan Am took delivery of 12 firm orders for the L-1011, from Apr-1980 to Nov-1981. They also had 14 options, which were not taken. Understandably, the 14 options were cancelled baecause of the 16 DC-10's taken through the National acquisition.


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