MEMPHIS, TN (abc24.com) - Pinnacle Airlines is flying out of Memphis and taking 500 good paying downtown jobs with it. Pinnacle is moving its headquarters to Minneapolis in large part because of Delta Airlines. Pinnacle is trying to get out of bankruptcy. Delta is providing its major financing and has cut many of the flights Pinnacle used to fly from Memphis.
It's uncertain if those 500 Pinnacle employees will have a job after the move. The city offered big incentives for the airline company to stay in downtown Memphis: free parking for their employees, cheap rent, etc. but it wasn't enough to cover their "bottom line."
"I'm not at all happy hearing that news. We tired our best. We put the odds in our favor to keep Pinnacle Airlines here unfortunately that didn’t happen,” said Downtown Memphis Commission President Paul Morris. He says it makes good business sense the company is moving to Minneapolis.
“Delta has moved a lot of flights out of Memphis and they operate more flights out of Minneapolis,” said Morris.
When Pinnacle Airlines filed for Chapter 11 Bankruptcy in 2012, Mayor A C Wharton suspected trouble was coming.
“Obviously we are disheartened at this but it does not in any way deter our determination to restore downtown to a vibrant bustling area, we're going to stay on it,” said the mayor.
"We're pretty happy to report that we have a real strong pipeline of companies that are looking into Memphis,” said the Senior Vice President for the Greater Memphis Chamber Mark Herbison. “And with Electrolux and Mitsubishi opening it's really gotten the word out around the country and we're seeing a lot more activity."
The city invested $2 million of taxpayer money to buy a parking garage and offered free parking for airline employees. Private investors spent over $20 million to remodel One Commerce Square to become Pinnacle's headquarters. That also attracted new tenants like the American Queen to move into the building. Morris says not all is lost.
“Pinnacle Airlines is not flying away with any taxpayer money or incentives. That incentive packages were used to redevelop Commerce Square and to buy the public parking garage that we still have,” said Morris.
Pinnacle has not said if those workers will be offered jobs in Minnesota so they may be joining the unemployment line. The move is expected to be complete by this May.