Evergreen EAGLE closes as Delford Smith's aviation group hits tarmac

HOUSTON -- One of Evergreen International Aviation Inc.’s last viable divisions closed abruptly Sunday night, stranding air cargo nationally.

Evergreen EAGLE managers told customers they were ceasing operations, no longer providing ground-handling services for major airlines at numerous U.S. airports.

The closure came shortly after Evergreen founder and chief executive Delford Smith told The Oregonian that the subsidiary, Evergreen Aviation Ground Logistics Enterprise Inc., was doing fine. 

EAGLE’s demise continues the collapse of Smith’s McMinnville-based aviation group as creditors drag its flagship Evergreen International Airlines Inc. into involuntary Chapter 7 bankruptcy.

“We received word from Evergreen EAGLE late last night that they were ceasing operations at all of their locations,” said Dan Landson, a Southwest Airlines spokesman in Dallas, in a statement e-mailed Monday.

The ground handling enterprise had continued generating income as Evergreen’s cargo airline parked planes and amassed debts and default judgments. Evergreen sold its helicopter division earlier this year to pay down debt. Smith has been selling off land from an agricultural subsidiary to raise cash.

Smith said Dec. 19 that another division -- Evergreen Trade, which carves up planes for parts sales -- had been doing well, along with Evergreen’s nonprofit aviation museum and water park. But an employee said that Mike Hines, head of the parent company, Evergreen International Aviation, told staff members in a conference call Monday that the Trade division would close Tuesday. Employees say the Trade division has been largely inactive, lacking money for aircraft purchases.

The museum and water park remain open, but creditors are selling two planes on display and the owner of the giant Spruce Goose wooden plane is seeking final payment for the flying boat. 

Therefore EAGLE’s closure leaves the privately held Evergreen group with few apparent assets for creditors, even as Smith tries to save the airline by converting the Chapter 7 liquidation into a Chapter 11 reorganization.

Smith has not returned repeated phone calls since Dec. 22 for comment. Hines did not return a call Monday concerning EAGLE and Evergreen Trade.

EAGLE provided ground handling services at more than 35 domestic airports such as New York’s JFK, Chicago’s O’Hare, Los Angeles, San Francisco, Seattle, Atlanta, Dallas, Miami, and Anchorage. EAGLE handled mail cargo and baggage transfers and provided skycap and wheelchair services. It broke down incoming cargo for delivery and storage. It provided aircraft cleaning, towing and pushbacks, crew transport, de-icing, loading and unloading, lavatory waste disposal and vehicle and equipment maintenance

The company supported carriers including Evergreen, the U.S. Postal Service, UPS, Singapore Airlines, Air India, Turkish Airlines, Pakistan International Airlines, Avianca, Emirates Cargo, Cathay Pacific Cargo, Air France, Nippon Cargo Airlines, Lufthansa and Korean Airlines.

Jens “Jay” Schulz, a former Evergreen International Airlines employee at New York’s JFK who works at a courier company, said he received an e-mail Monday from a Southwest Airlines cargo representative concerning EAGLE’s shutdown in Milwaukee.

“Very sorry for the trouble and inconvenience this sudden news causes,” the Southwest Airlines e-mail said. “Unfortunately Southwest Cargo management did not receive word from Evergreen until late last night that they were ceasing cargo handling operations at all locations including MKE.”
Schulz is a plaintiff in a federal class-action suit seeking back wages and benefits from Evergreen. He said Southwest Airlines informed customers that EAGLE had stopped accepting outbound freight.

“We are working towards resuming freight operations at MKE as soon as possible,” the Southwest Airlines cargo rep wrote.

Landson, the Southwest Airlines spokesman, said EAGLE provided cargo handling solely in Milwaukee for the airline, which had used the service for about 18 months.