September 27, 1999

Thousands hit by Color Air bankruptcy

    Some 20,000 passengers, more than 200 employees and hundreds of creditors have been hit by Monday's sudden grounding of cut-rate but loss-ridden airline Color Air. Some workers say they feel cheated.

    Color Air's low passenger counts and heavy financial losses were well-known in the market, but staff members nonetheless say management sent out optimistic signals as recently as last month. One leading flight attendant said staff was told that more capital would be pumped into the airling carrier.

    But directors at a board meeting Sunday night decided to cut their losses and cease operations immediately. Color Air, which only survived 13 months, lost NOK 245 million in the first half of this year alone.

    Rival Braathens says it will honor Color Air tickets, but 220 employees will lose their jobs as of October 1.