UPDATED: Mexicana files for insolvency

Mexican airline Mexicana, part of the oneworld alliance, has filed for insolvency “to bring its cost structure into line with market conditions”, the company said in a statement. It is seeking bankruptcy protection from a US court.

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Meanwhile the airline is continuing to operate its domestic schedules, as it says its MexicanaClick and MexicanaLink are independent and are unaffected by the reorganisation of Mexicana’s parent company, Compañía Mexicana de Aviación (CMA). Ticket sales have been suspended on the latter although existing flights are still operating.
The insolvency action is a legal procedure that allows a company to reorganise its liabilities and costs while protecting its operations. CMA filed the insolvency petition with a Mexico City district court to begin a reorganisation and negotiation process to ensure the continued operation of the airline. The action in the US was filed to protect and guarantee airline operations in country.
CMA says its costs, “particularly those associated to flight crews” are “well above” the industry average and need to be brought into line with market conditions.
August 31: Mexicana Airlines (Grupo Mexicana) suspended its operations indefinitely on August 28.
A statement on the airline’s website says it is “technically bankrupt”. Financial deterioration and lack of agreements have forced Grupo Mexicana to stop flying operations.