Aeromexico files for Chapter 11 bankruptcy protection

Aeromexico files for Chapter 11 bankruptcy protection
Photo: Nyker/Shutterstock

Aeromexico joined Latam and Avianca as the third major airline in Latin America to request protection against bankruptcy in the U.S. after a Chapter 11 filing on Tuesday night.

The company labeled the measure as “voluntary” and said it will continue to scale up operations over the coming weeks in an attempt to slowly return to pre-pandemic activity levels. Over the coming month, Aeromexico expects to quadruple its international flights and duplicate domestic flights.

Yet, the Mexican-based airline sees a new government financing plan as crucial to weather the financial losses caused by the Covid-19 pandemic. The airline sector has been one of the hardest hit by the pandemic with smaller companies almost sure to be phased out of an increasingly hostile market for small businesses.

In May, The Brazilian Report covered a plan by the Brazilian Development Bank (BNDES) to bail out airlines in Brazil by way of a special BRL 10 billion (USD 1.87 billion) credit line.

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