Flying Straight Into Chapter 11

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Aviation has long been considered a glamorous and prosperous industry. Starting with the Jet Age in the 1960s, airlines have sprung up quickly and names like Pan American and Trans World became household names. However, in less than fifty years, the airline industry has been hit hard. No longer are the days of Pan Am and TWA, instead the only true legacy carries remaining are United-Continental Airlines, Delta Airlines, and American Airlines. Eastern, TWA, Pan Am, and a slew of others fell prey to a variety of modern day problems. Probably the best example of how modern problems affected the airlines is to look at United-Continental. Though the airline continues to fly, it has faced its fair share of issues. Starting in the early 1990s the airline began to have financial difficulties, which would later be added to by the tragedy of September 11th. All of these factors eventually lead to the inevitable, a declaration of bankruptcy. To fully understand what happened at United Airlines we must look to the late 70s as a starting point. During this decade, the Airline Deregulation Act of 1978 was passed. The goal of the act was to improve competition in the airline industry and lower the cost of airfare. Before airlines applied for routes and thus monopolized a particular segment. However, the act abolished this in favor of an anything goes method. Airlines no longer had to be approved for routes; they can essentially fly any route they wanted to (U.S. Centennial of Flight Commission ). As one can imagine, this created a surge of new entrants into the airline industry. In the 1980s air traffic rose by 20 million people finally ending the decade with a shattering 466 million passengers. Everything seemed to be working at least for Un... ... middle of paper ... ...ns on Employee Ownership. November 2002. 9 December 2011 . The Associated Press. Timeline of United Airlines' bankruptcy. 1 February 2006. 9 December 2011 . U.S. Centennial of Flight Commission . United Airlines. 9 December 2011 . United-Continetal Holdings. United Continental Holdings, Inc. Announces Fourth-Quarter and Full-Year 2010 Results. 26 January 2010. 9 December 2011 . Ziemba, Stanley. Pan Am Deal Makes United Airline Leader. 11 December 1991. 9 December 2011 .

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