Oct. 29--Troubled air cargo company Kitty Hawk Inc. is shutting down all its network air freight and ground shipping services immediately and offering only cargo charter flights, the carrier said Monday.
The shutdown will eliminate about 500 jobs at its operations at Dallas/Fort Worth International Airport, Fort Wayne, Ind., and other locations.
Kitty Hawk, which includes subsidiaries Kitty Hawk Cargo, Kitty Hawk Ground and Kitty Hawk Aircargo, filed two weeks ago for Chapter 11 bankruptcy protection from creditors.
"Kitty Hawk's financial condition has deteriorated significantly over the last year and the ceasing of network air and ground operations is necessitated by, among other things, a 25 percent decrease in year-over-year demand for its air product and a 15 percent year-over-year decrease in demand for its ground product," Kitty Hawk said in a press release.
"In conjunction with lower demand for Kitty Hawk's services, record high jet and diesel fuel prices have contributed to Kitty Hawk's inability to continue network air and ground operations," the company stated.
The company warned investors in August that it would likely need additional loans or equity to "fund our operations during the second quarter of 2008," but headed to federal bankruptcy court two months later.
Kitty Hawk reported net losses of $19.9 million in the first six months of 2007 and more than $34 million since Jan. 1, 2006.
Kitty Hawk, which has its headquarters at D/FW Airport, also announced Monday that it has failed to meet requirements to remain on the American Stock Exchange and expects to be delisted as of Wednesday.
When Kitty Hawk filed its bankruptcy papers Oct. 15, it said it had 776 employees, including 671 who were fulltime workers.
Kitty Hawk previously filed for bankruptcy protection in May 2000, emerging as a reorganized company in October 2002.
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