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. Last Updated: 07/27/2016

Crash Halts Airline's Plans for Progression

NEW YORK -- The TWA jet crash has tainted a stunning turnaround at the airline, which just quadrupled profits, expanded plans to replace old planes and sought a lucrative London route sold during its darkest days.


Moreover, the crash of Paris-bound Flight 800 shortly after takeoff from Kennedy Airport late Wednesday could become a financial and image-shattering nightmare for TWA, a pioneer of American aviation that has been in and out of bankruptcy court twice in the past few years.


While strong airlines like American, United and Delta have survived crash disasters, their weaker brethren have stumbled or watched their business fail.


In the first trading since the crash, TWA stock was down 10 percent on the American Stock Exchange at midmorning, dropping $1.12 1/2 , to $10.12 1/2 a share.


USAir has struggled through a series of crashes. No-frills ValuJet was shut down last month after one of its planes crashed May 11. Pan American World Airways, which like TWA helped trailblaze the industry's international routes, spiraled into bankruptcy and collapse five years ago.


Although it may be premature to speculate on how the TWA crash will reverberate through the airline's future, it shattered what had been a day of celebration.


TWA had just reported that its economic woes were largely over when news came that a 25-year-old Boeing 747-100 with more than 200 people aboard had crashed into the Atlantic Ocean off Long Island with no sign of survivors.


The St. Louis-based carrier earned $25.3 million, compared with $5.2 million a year ago. Revenue rose 12 percent to $965.8 million from $860.5 million. It also announced more details of a plan to replace many of the planes in its 189-jet fleet, the oldest in the country.


The disaster coincided with a visit to London by TWA chief executive Jeffrey Erickson, seeking to re-establish the airline's permission to fly from Kennedy to Heathrow airport, one of the most profitable routes.


TWA sold the rights to fly to Heathrow years ago when it was struggling to survive. The airline once was so cash-strapped it mortgaged landing rights at airports and sold bonds backed by light bulbs and other spare parts as collateral.


Despite the better results, the carrier is still not financially secure, magnifying the potential damage of the crash if it discourages passengers from flying on TWA planes.


Such was the case for Pan Am, which folded in 1991, an indirect result of the stigma it suffered after Flight 103 exploded in a terrorist bombing three years earlier over Lockerbie, Scotland. The crash killed 259 passengers and crew members.


USAir, on the other hand, emerged as an enduring survivor despite five crashes in five years. In the first quarter of this year, the airline narrowed its chronic losses.


ValuJet is still trying to pull itself from a financial meswn The Atlanta-based carrier was grounded by the Federal Aviation Administration on June 17 after a May 11 crash in the Florida Everglades killed 110 people.


Valujet has filed a plan with the FAA to fly again in August, with better-trained and higher-paid staff. The FAA has not said if it will approve the plan.