As Airlines Failed, CUs Responded With Image Overhauls, Member Relief
Among them was Aloha Airgroup, the parent company of Aloha Airlines Inc., which closed shop on March 31 less than two weeks after filing for bankruptcy for the second time in three years. The shutdown affected roughly 1,900 of Aloha Airlines Federal Credit Union's 4,595 members. The $28 million credit union, which eventually dropped the word "airlines" from its moniker, was approved in July for a trade, industry and profession charter to serve Hawaii's airline industry as well as the government employees who work directly in the administration, regulation or security of airlines, airports or air transportation among a number of other groups. The credit union decided to revamp its brand in a final attempt to sever the 56-year tie with its sponsor.
Indiana credit unions braced for the closure of ATA Airlines and the loss of jobs for its more than 2,200 employees. The $1 billion FORUM CU implemented its work out program for the few members who were former ATA Airline employees. Ohio-based Skybus Airlines also met its demise this year, filing for bankruptcy in April. To aid members who purchased Skybus tickets with their credit union credit and debit cards, $1.4 billion Wright-Patt CU provided an online dispute system for refunds. Milwaukee-based Skyway Airlines joined other carriers that ceased operations this year.
Meanwhile, the airline industry experienced one of the biggest mergers on record with Delta Airlines and Northwest Airlines. Announced in April, the $35 billion combined company stands to have 75,000 employees worldwide and nearly 800 aircraft. The $2.7 billion Delta Community CU remained quiet on the merger, choosing to move forward with its new logo earlier this year and plans to build its presence throughout Georgia. The $2 billion Wings Financial FCU was originally chartered to serve Northwest Airlines before expanding to a TIP charter several years ago. The financial institution was optimistic about what the merger would mean for growth opportunities. It has also continued to build alliances with other carriers and recently opened its 18th branch at John F. Kennedy International Airport.
A few merger rumblings did little to shake the long-term strategic plans at several airline-linked credit unions. When speculation of a United Airlines and Continental Airlines merger surfaced in the spring, $5.7 billion Alliant CU chose to stick to its expansion and diversification goals. Originally chartered to serve United, nearly 71,000 of Alliant's 212,000 members are active employees with the carrier. The $200 million Continental FCU rolled out its member assistance program in September for those who lost their airline jobs. In November, president/CEO Tom Glatt announced that he would leave Continental FCU to head the newly chartered REALTORS FCU. United and Continental would eventually link their fare and flight systems to combat exorbitant fuel costs.
In related news, John Tippets, longtime CEO of $4 billion American Airlines CU, retired this summer after 17 years of service, passing the reins to Angela Owens.