Pride Air Suspends Service
NEW ORLEANS (AP) _ Pride Air has suspended its flights for at least five days because of a cash crunch, company officials said.
The announcement came Friday night, less than 24 hours after the airline said it had secured additional cash from investors. Airline officials said they hoped to resume service by Thursday.
Since the airline began service from New Orleans on Aug. 1, five unprofitable routes have been dropped, a $10 million stock offering was scrapped and 122 employees have been laid off. The remaining 566 employees were asked to skip their Nov. 1 paychecks.
Pride established routes from New Orleans to Denver, Salt Lake City, San Francisco, Las Vegas, San Jose, Calif., Los Angeles, San Diego and seven cities in Florida: Jacksonville, Orlando, Tampa, Sarasota, West Palm Beach, Fort Lauderdale and Miami.
Last week, the First National Bank of Commerce froze $200,000 in the airline’s accounts and several suppliers threatened to cut off service because of unpaid bills.
On Thursday, investors turned over the first $1.5 million of a financial rescue package that could reach $50 million, airline spokesman Kiv Kiviranna said. He said the airline expects to receive another $10 million on Monday.
Pride’s passenger load rate recently has been more than 55 percent, and on some days has exceeded the carrier’s break-even rate of 63 percent or 64 percent, Pride Chairman Paul Eckel said.
Pride’s president and co-founder, Barrie Duggan, resigned on Tuesday and so did chief financial officer John Dvorak. Dvorak was replaced by Richard Sklar of Tulsa, Okla., one of the leaders of the rescue effort.