Colombia’s nationwide airline, Avianca, has filed for economic spoil protection in a US court.
The provider is the 2d-supreme in Latin The USA, but its passenger operations had been grounded since March as a result of coronavirus.
It acknowledged the pandemic had slice more than 80% of its profits, and it was struggling with excessive mounted prices.
If it fails to come aid out of enterprise spoil, Avianca could be the first most predominant airline to wander under amid the pandemic.
In an announcement, the agency acknowledged it had filed for Chapter 11 economic spoil protection in a court in Contemporary York. The formulation postpones a US company’s duties to its collectors, giving it time to reorganise its money owed or promote formula of the enterprise.
Chief executive Anko van der Werff acknowledged the switch was predominant to develop definite the Contemporary York-listed airline emerge as a “better, more ambiance pleasant airline that operates for many more years”.
Extra than 140 of its plane had been grounded since Colombian President Ivan Duque closed the country’s airspace in March. Most of its 20,000 employees had been build on unpaid wander away.
Within the aid of KLM, Avianca is the 2d-longest repeatedly operating airline in the enviornment.
It previously filed for economic spoil in the early 2000s, and was rescued by a kind out Bolivian oil rich particular person German Efromovich. The airline grew snappily under his stewardship, but its rising debt led to a a hit boardroom coup against Mr Efromovich closing yr. It is now ride by Kingsland Holdings.
The coronavirus pandemic has dealt a pleasant blow to the worldwide aviation enterprise, as governments impose bound restrictions and confinement measures.
World air bound has fallen by 90%, according to the World Air Transport Association. The body predicts Latin American airlines will lose $15bn (£12bn; €13.9bn) in revenues this yr – the supreme fall in the enterprise’s historical past.