ExpressJet files for Chapter 11 bankruptcy after failed Reno operation

Atlanta-based ExpressJet has filed for Chapter 11 bankruptcy and shut down its short-lived flight operation based out of Reno, Nevada.

It’s the second time ExpressJet has shut down in the last two years.

ExpressJet, formerly known as Atlantic Southeast Airlines or ASA, was a Delta Connection regional carrier for decades. But it lost its Delta contract in 2018, then in 2020 lost its remaining contract with United Airlines for United Express flights and shut down in September 2020.

Last year, ExpressJet relaunched with a leisure brand called aha! operating flights from Reno-Tahoe International Airport to cities in western states.

But on Tuesday, ExpressJet announced it had filed for Chapter 11 bankruptcy protection and ceased all flight operations. Though a Chapter 11 filing typically indicates a debtor plans to restructure, that is not always the case, and ExpressJet said it will ultimately liquidate its assets.

The move left customers in the lurch. ExpressJet told customers who had flight bookings to contact their credit card company to request refunds, and said the airline “is unable to assist with alternate travel arrangements.” Those who cannot get refunds from their credit card companies can file a claim as creditors in the bankruptcy process.

“A combination of conditions led us to this decision,” said Subodh Karnik, Chairman and CEO of ExpressJet, in a written statement. “Despite the valiant efforts of our employees to overcome challenges, and despite great support by our cities and airports – especially Reno-Tahoe and the community there, we arrived at a point where termination of operations was in the best interest of our stakeholders.”

The company said growth was necessary for its business plan but was hampered by “lack of availability of aircraft and the inability to swiftly establish passenger servicing infrastructure in smaller airports.” It also said revenues were lower due to COVID-19 variants.

And although the aha! name was said to stand for “air hotel adventure,” the carrier was unable to roll out air-hotel packages that were foundational to its plans.

ExpressJet said it plans to start liquidating under court supervision in coming weeks.

Karnik was the majority investor in ManaAir LLC, which acquired ExpressJet from regional carrier SkyWest in 2019. Karnik’s KAir Enterprises LLC then became the majority owner of the aha! incarnation of ExpressJet.