World's second-oldest airline files for bankruptcy, citing the 'unforeseeable impact' of coronavirus
Source: Washington Post
5:46 a.m.
World's second-oldest airline files for bankruptcy, citing the 'unforeseeable impact' of coronavirus
Avianca, the world's second-oldest airline and one of the largest carriers in Latin America, filed for bankruptcy protection in U.S. court Sunday as coronavirus-related travel restrictions continue to cripple the aviation industry. ... The Colombian airline filed voluntary petitions in bankruptcy court in the Southern District of New York, citing the "unforeseeable impact" of the ongoing pandemic, according to a news release. ... Since mid-March, all of Avianca's scheduled passenger operations have been grounded, causing the airline's revenue to go down by more than 80 percent, which in turn placed "significant pressure" on cash reserves, the release said.
"Avianca is facing the most challenging crisis in our 100-year history as we navigate the effects of the COVID-19 pandemic," Anko van der Werff, the airline's chief executive, said in the release. ... Van der Werff said filing for bankruptcy is a "necessary step to address our financial challenges," and later added that he is confident Avianca will "emerge as a better, more efficient airline that operates for many more years."
Founded in 1919, Avianca serves more than 30 million passengers a year, the release said. The airline is also directly responsible for more than 21,000 jobs throughout Latin America, including more than 14,000 in Colombia.
If Avianca does not come out of bankruptcy, it will be the first major airline to go under amid the pandemic, which has largely halted global air travel. Like many other airlines worldwide, Avianca said it has been seeking financial support from governments in countries where it operates.
By Allyson Chiu
Read more: https://www.washingtonpost.com/nation/2020/05/11/coronavirus-update-us/#link-XKOCGLNOJBEBJFKD3OKTYYGRGI
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