COLUMBIA, S.C. (AP) - After a three-year financial roller coaster, Air South called it quits Tuesday when the discount carrier was unable to find a buyer and keep its license.
"What killed us this last year was ... we just couldn't get the airplanes to the gates on time," said Tom Volz, Air South's marketing vice president. "We just kept shooting ourselves in the foot."
Company officials probably will sit down with attorneys to discuss converting Air South's Chapter 11 bankruptcy protection case to a Chapter 7 liquidation, Volz said.
While the Columbia-based airline's planes were leased from GE Capital Aviation Services, the company can sell off its computers, trucks and reservation center. Liquidation could take up to six months, Volz said.
The Jobs Economic Development Authority then can use the cash to pay down the $12 million federal loan guaranteed by the state when Air South was launched.
Volz said the airline's license to fly would go back to the Federal Aviation Administration for cancellation.
"Today's a relief," said Volz, one of the original founders. "It just seems like every six months we'd hiccup."
He commended the no-frills airline for creating more than 485 jobs and saving Midlands passengers about $20 million in air fare in three years.
South Carolina taxpayers have footed the bill since Air South's 1994 beginnings, and because the airline filed for bankruptcy protection, the state might get stuck paying about $16.8 million altogether.
South Carolina already has paid $5.5 million toward the loan, while the airline paid only $172,189 in interest over three years.
The airline's liquidation will help pay off the loan.
When Air South suspended operations Aug. 28, it reported $67.4 million in liabilities against $11.5 million in assets.
The airline lost $7.8 million in the first quarter this year and a combined $41 million in 1995 and 1996.
Volz said he did not know what would happen to the two lawsuits Air South and its officials face.
Three former employees and an investor sued, claiming there was a conspiracy to deny Air South stock to the public so an investment bank, San Francisco-based Hambrecht and Quist, could take control of the airline.
The more recent suit came from some Air South founders who say board members defrauded shareholders, mishandled the company and concealed financial information. Patrick O'Shea, a former Air South chief executive, along with founders Donald Baker and Rod Marlin, sued Clifton Haley and William Hambrecht.