Debt-ridden carrier Mexicana and its domestic subsidiaries were due to start suspending flights midnight on Friday and halt all operations by the next day as they seek to restructure costs, Mexico’s transportation secretary said.
The country’s biggest airline is forced to shut down because it does not have enough money to keep flying, Juan Francisco Molinar Horcasitas told reporters.
But Mexicana de Aviacion “is in a process that should lead to restructuring,” Molinar said. He declined to give specific details of Mexicana’s financial situation.
The airline filed for bankruptcy protection in Mexico and the US on Aug. 2, and later stopped selling tickets and suspended some flights.
Executives said this month that the company needed an infusion of at least US$100 million to keep flying and on Aug. 21 a group of Mexican investors called Tenedora K announced it had bought a 95 percent stake in Grupo Mexicana, which controls Mexicana and the domestic airlines MexicanaClick and MexicanaLink. All three airlines were to be grounded by yesterday afternoon.
On Friday, Mexicana said in a statement on its Web site that current management received the airline “in a state of technical bankruptcy.”
In court filings, Mexicana said it was badly hit by the swine flu outbreak last year that scared away travelers for months and by the global economic slowdown. The airline added that high jet fuel prices and labor costs contributed to its financial troubles.
Mexicana flies to more than 65 national and international destinations, including the US, Canada, Central America, South America and Europe. It transported 11.1 million passengers last year, according to the company’s Web site.