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labor cost don’t cause bankruptcies in general. However, f9 fapa structured pay concessions taken in bankruptcy into equity in the company. It was incorporated into the ch 11 plan to emerge from bankruptcy. Fapa became a secured creditor along with all the other creditors (Airbus, ge, leasing companies, ect.). The value (% of company) of it was the value of the concessions taken at the time and by some miracle (valuation was done 2 months prior to Covid) it paid back close to 100%. Now I’m not suggesting this at all right now. It’s more of a potential card to play in bankruptcy for unions in general. I believe This is how some legacies and others secured profit sharing plans in bankruptcy? It’s pretty much the same concept but turns into a one time payment instead of profit sharing indefinitely which imo is preferable.Originally Posted by Meme In Command
Not Braniff, Eastern, Pan Am, not any airline that I've read about pre-9/11 failed or went under due to labor costs. But, it's the easiest thing to blame for anti-union management and/or politicians