Texas Air Corporation
Texas Air was an airline holding company incorporated in 1980 in the United States created to hold and invest in airlines, starting with Texas International Airlines as its core. The company had its headquarters in the America Tower in the American General Center in Neartown Houston, Texas.
After passage of the Airline Deregulation Act in 1978, Texas International Airlines expanded significantly, reduced its costs by discontinuing unprofitable routes and replaced its outdated Convair turboprops with newer DC-9 aircraft. In 1982 Texas Air took over then debt-laden Continental Airlines, retaining Continental's better-known and less regional name. Continental Airlines, in moribund financial condition, succeeded in negotiating concession packages with all of its unions except for the International Association of Machinists (IAM). Because of the refusal of the IAM to renegotiate its contract, the company ultimately filed for Chapter 11 bankruptcy, which allowed Frank Lorenzo (President and chief executive officer), to reject the collective bargaining agreements with its various unions. Many believe that Lorenzo wanted the strike to justify the bankruptcy filing, so that he could get rid of the unions.{Hard Landing. Thomas Petzinger, Jr. p 234} Continental Airlines would again file bankruptcy in 1991, one month after Lorenzo left his position as CEO.
In 1985, the company lost a bid to take over Trans World Airlines to corporate-raider Carl Icahn. In 1986 the company acquired Eastern Air Lines and People Express, with its Frontier Airlines included. By 1987 Texas Air Corporation had control of 20 percent of the U.S. airline market, even though the holding company only had 20 official employees.
By the early 1990s the company had been split up, with parts sold to Scandinavian Airlines System, Ross Perot's EDS (Electronic Data Systems), and an Air Canada-led investment group. Most of the former Texas Air became known as Continental Airlines, and eventually merged into United Continental Holdings.
Read more about Texas Air Corporation: Holdings At Its Peak
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