Cash-strapped Tower Air has ceased scheduled flights, while another US carrier, cargo specialist, Kitty Hawk, has filed for Chapter 11 bankruptcy protection.

New York Kennedy-based Tower, a Boeing 747 operator, cut flights and filed for Chapter 11 status earlier this year. Then, on 2 May it scrapped operations to Los Angeles, Miami, San Juan, Santo Domingo, Paris, Athens and Tel Aviv, leaving hundreds of customers stranded. A rumoured Israeli rescue failed to materialise.

Passenger charters and cargo flights continue, although the carrier does not rule out a total shut down. "We don't know. Anything is possible," it says.

Dallas-based Kitty Hawk's protection filing came ahead of its failure to meet a $17 million interest payment, due on 15 May, on a $340 million loan secured to buy American International Airways (AIA) in 1997. It earlier received an unexpected $35 million bill to overhaul engines for some of its widebodies (seven Boeing 747s and six Lockheed L-1011 TriStars), acquired with AIA, and was forced to reduce the book value of 13 ex-AIA McDonnell Douglas DC-8 freighters, which can no longer fly in the USA. High fuel prices and soft freight demand also hit hard.

Kitty Hawk International, Michigan-based operator of the stricken widebodies, suspended operations on 1 May. Normal operations continue at Kitty Hawk Cargo, providing overnight services through Fort Wayne, Indiana, the Boeing 727-based Kitty Hawk Aircargo division, and the Kitty Hawk Charters unit.

A management shake-up has removed chairman and chief executive Tom Christopher and board members, including Conrad Kalitta, once of AIA.

Source: Flight International