CBSN

Gloomy Forecast For Sun Country

Sun Country airlines jets Nov. 27 Minneapolis
AP
Sun Country Airlines is laying off nearly all of its 900 remaining employees effective at midnight Friday, a spokeswoman for the financially troubled carrier said.

Spokeswoman Tammy Lee said the employees were told Friday that it would be their last day.

David Banmiller, Sun Country's president and chief executive officer, is among six key employees who will remain, and some flight crews will stay on through Saturday to fly five remaining charter flights. Lee said around 40 more employees will be brought back as consultants early next week as the airline continues it search for a buyer.

Lee said executives are considering filing for bankruptcy reorganization, but their first choice is to find a buyer. She said Sun Country is still in discussions with a number of potential investors.

"We're really in self-preservation mode. We have to scale back the operation, limit the liability and continue to fly," Lee said.

In the meantime, she said, the remaining employees will take care of the business needed to keep the airline certified to operate and flying charter flights.

Sun Country announced Thursday that it would leave the scheduled airline business, at least temporarily, and refocus what was left of the airline on charter flights, which is how the carrier began. Since June 1999, when it began going head-to-head against, Northwest Airlines, Sun Country reportedly has lost nearly $80 million.

Anne Meyer, vice president of Teamsters Local 2000, which represents 120 flight attendants, said this is going to be a "very difficult" time for Sun Country's flight attendants, who have experienced many ups and downs over the last few years. She said Local 2000 was contacting the Teamsters' service bureau and the state Department of Economic Security to line up help for them.

"We're going to help them out in any way we can," she said.

The union leader said she doesn't believe Sun Country is dead, but that she couldn't predict how big of a carrier would emerge from this crisis.

"I don't think this is the end of Sun Country," Meyer said. "I think they're going to do everything they can to keep this airline operating. I really believe that."

Lee also said this is not necessarily the end, but conceded that Sun Country is likely to be much smaller if it survives.

"We're going back to the basics," Lee said. "This company started with one plane and a small group of employees. We will be going back to a similar model. I don't know if it will be one airplane or two or four."

Sun Country announced Thursday that after Saturday, it would operate separately from the La Macchia family of Milwaukee, which owns the airline and Mark Travel Corp. The move came after major tour operators such as TransGlobal Vacations, Funjet Vacations, Hobbitt Travel and even Mark Travel switched all their flying to other carriers.

As it downsized in recent weeks, Sun Country stopped flying its 10 older, leased Boeing 727 jets, leaving only its seven ne737s.

Prior to the Sept. 11 terrorist attacks, Sun Country served more than 30 cities, and had 1,500 employees. But the airline was down to 14 cities just before it announced Thursday it was halting regularly scheduled service. It was also down to just eight to 12 flights a day from its base in Minneapolis-St. Paul.

Sun Country received $8.2 million in the first round of federal grants to help airlines stabilize after Sept. 11 and had hoped for more than $16 million total by the end of the year. But it suffered serious blow when it received less than $350,000 in the second round — $5 million short of its request.

©MMI The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed