Thanks to our still-troubled economy and the mortgage and foreclosure crisis that is wreaking havoc on homeowners across the country, Maricopa County readers have probably gotten used to hearing about bankruptcy in the news. After all, it seems like there is some new story or report on bankruptcy every day.
Sometimes, when a concept like bankruptcy becomes a part of our awareness landscape, myths or half-truths about it become accepted as fact. One such misconception may be that bankruptcy equals financial ruin. This is hardly true, especially when it comes to companies filing for business bankruptcy. While a bankruptcy filing is an indication that things aren’t quite right with a company’s books, what it offers is a chance to start over and tackle issues from a fresh and more strategic position. Many times, that’s all a business needs to get back in the black.
Take the case of American Airlines. The carrier filed for bankruptcy last year. Now, it seems that its reorganization has been nothing short of a smashing success. It emerged from bankruptcy late last year, domestic revenue is up nearly 10 percent and its Latin American unit is flourishing, meaning it shows promise as a new and possibly lucrative business sector. American has focused on connecting southern U.S. cities like Dallas, Miami and Los Angeles with South American travel destinations and so far, it seems like the company has tapped into an under-served market.
We don’t mean to say that American Airlines is out of the woods yet, but hopefully Phoenix business owners will look at what has happened with the company and will understand that bankruptcy, while being a serious step, is nothing to be feared.
Source: U.S. News and World Report, “American Airlines Is Thriving Despite Bankruptcy,” Thomas C. Lawton, June 15, 2012