Mexico’s flagship airline announced Tuesday that it has applied to start restructuring under Chapter 11, which will allow it to continue flying.
“Our unprecedented industry faces challenges due to significant declines in demand for air transportation,” CEO Andrés Conesa said in a statement. “We are committed to taking the necessary measures so that we can operate effectively in this new landscape and be well prepared for a successful future when the Covid-19 pandemic is behind us.”
Aeromexico intends to use the process “to strengthen our financial position, obtain new financing and increase our liquidity,” Conesa said.
Day-to-day operations will continue as the company begins a financial overhaul. Passengers should still be able to fly using their existing tickets, and employees will continue to get paid as usual, according to management.
The company is also hinting at a gradual recovery. As air travel begins to rebound in some countries, Aeromexico will “expand flight service” imminently, with plans to double its domestic flights and quadruple international capacity in July compared with levels from last month, it said.
The carrier now needs to “create a sustainable platform to succeed in an uncertain global economy,” added Conesa.