Eastern Says It’s Nearing End of Chapter 11

Eastern Airlines officials said Tuesday that the carrier will emerge from Chapter 11 bankruptcy early next year and that it is ahead of its goal of having 800 flights a day by December.

By spring, they added, the Miami-based airline, which has been struck by its pilots, machinists and flight attendants since March 4, expects to be operating 1,000 flights daily, only about 50 less than its pre-strike schedule.

Eastern President Phil Bakes also said the airline expects to be out of the red sometime in 1990--its first profit “to speak of” in a decade. Bakes appeared at a news conference here with Frank Lorenzo, chairman of Eastern and of its parent, Texas Air Corp.

“We are pleasantly surprised,” Lorenzo said, “that we are rebuilding the company faster than we had anticipated. As of now, we are 75% of our pre-strike size, and by December we should be over 80%.”

He said Eastern’s original projection was that it would be able to grow to between 60% and 65% of its pre-strike size by the end of this year. Bakes said Eastern will operate a fleet of 188 planes next spring, 67 less than it had before the strike but substantially more than it projected in the business plan it filed with the federal bankruptcy court in New York in April.

Bakes said 800 pilots who were working for Eastern before the strike are on the payroll today. Two hundred of them crossed the picket lines when the strike began, he said, and the other 600 have returned since then. Another 1,000 have been hired, Bakes said. The present total of 1,800 pilots compares to the pre-strike total of 3,500.

The newly hired pilots, Bakes said, have an average of 17 years of flying experience and 5,700 hours in the air as pilots. Another 230 pilots seeking their old Eastern jobs back are on a list that should be depleted in six to eight weeks.

Bakes said the airline now has 17,340 employees altogether and expects to have 20,000 by year’s end. That is 10,000 less than before the strike but nearly 5,000 more than the projection included in the April business plan.

Bakes said the airline had sold about $1.4 billion in assets since it entered bankruptcy proceedings five days after the strike started. Eastern officials have said ever since the carrier went into bankruptcy that it planned to sell assets and to emerge as a leaner, smaller carrier.

Airline analyst John W. Mattis, vice president of high-yield research for the investment firm of Shearson Lehman Hutton, said: “The real test (for Eastern will be to) . . . make a profit in 1990 when they emerge from bankruptcy.”