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Massport Says Delta Must Pay to Keep `A'

Posted on: Saturday, 29 October 2005, 21:00 CDT

By SCOTT VAN VOORHIS

Logan International Airport has put struggling Delta Air Lines on notice, amid a looming risk that the carrier may try to bail out of its expensive commitment to the airport's newly built showcase, Terminal A.

Craig Coy, head of the state authority that oversees Logan, told business leaders this week he would consider yanking Delta out of Terminal A and moving it to another Logan terminal if it defaults on payments.

The move comes as Delta battles to shore up its shaky finances in bankruptcy court. The carrier recently sought to pull out of payments for facilities in Los Angeles, and may be in danger of defaulting on a major Terminal A payment due in January, industry observers have said. Delta is on the hook for payments on the $400 million-plus bond package that financed the new terminal, which opened earlier this year.

If Delta were to default, then Massport, which oversees Logan, might move the airline out of Terminal A, replacing it with fast- growing, low-cost carriers like JetBlue and AirTran, Coy told executives at a recent Greater Boston Chamber of Commerce breakfast.

A spokeswoman stressed that Coy was speaking "hypothetically" and that no airlines had been approached about taking Delta space.

Another option that Massport might consider, should Delta default on its payments, would be to move other airlines into the terminal alongside Delta, spokeswoman Danny Levy said.

Source: Boston Herald

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