Financial Troubles
In the early summer of 1987, Trans-Colorado began to experience serious financial difficulties. In a September 30 letter to a financial organization, a company official stated that "...the only cash that is paid out will be only that which is essential to fulfilling the requirements of the Continental contracts."
On December 3, 1987, Trans-Colorado's chief executive, William Mueller, wrote employees that "We have begun working on our long term restructure plan, which deals with both creditors and revenue sources. Please hang in with us, as great strides have been taken the last few weeks to stabilize the Company, but we still have a lot of work to do."
After the contract with Rocky Mountain expired, Trans-Colorado then moved its operations and maintenance facilities to Houston, TX, in anticipation of a contract to operate as a feeder to Continental Airlines though another wholly owned Continental subsidiary, Britt Airways.
For several months, Trans-Colorado operated flights for Britt; however, no long-term contract materialized. In April 1988, Trans-Colorado filed Chapter 11 bankruptcy protection from its creditors. In July 1988, it ceased operations and voluntarily surrendered its operating certificate to the Federal Aviation Administration. According to Trans-Colorado, the ending of operations were "as a direct result of economic hardship imposed by Continental Airlines (Britt Airways, Continental Express) when the prematurely terminated our contract with them."
Read more about this topic: Trans-Colorado Airlines
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