The airline Avianca pushed into bankruptcy by the Covid-19

The second Colombian airline, Avianca, has asked to be brought under bankruptcy protection law in the United States “because of the unpredictable impact” of the coronavirus. All of its passenger activities have been suspended since the end of March.

In a statement released on Sunday, Avianca said that with “some of its subsidiaries and affiliates” it has asked to “voluntarily place itself under Chapter 11 of the bankruptcy code”, in a New York court.

Chapter 11 of the US bankruptcy law allows a company to restructure, often at the cost of massive job losses, without pressure from its creditors.

Airline operations “have been significantly affected by the Covid-19 pandemic,” as well as containment measures across the globe, the group said, adding that the company was still subject to “costs fixed high “.

142 planes nailed to the ground

The suspension of passenger activities following the decision of Colombian President Ivan Duque to close the country’s airspace as the number of people affected by the epidemic increased.

The measure, which nailed 142 planes to the ground, “reduced consolidated revenues by more than 80% and placed heavy pressure on the company’s liquidity,” the statement added, adding that 12,000 of the 20,000 employees would take leave without pay.

The coronavirus pandemic has dealt a severe blow to the aviation industry as a whole, struck by the containment measures imposed on billions of humans around the world. The International Air Transport Association (IATA) has estimated revenue losses for Latin American airlines this year to 15 billion dollars, the industry’s worst crisis in history.

Avianca, which was already placed under Chapter 11 in the United States in 2003, recorded a net loss of $ 894 million in 2019, compared to a profit of $ 1.1 million a year earlier.