Latin American Airline Avianca Files For Bankruptcy

SMS
Latin American Airline Avianca Files For Bankruptcy
Avianca reports it hasn't paid most of its 20,000 employees since late March.
SHOW TRANSCRIPT

A popular Latin American airline has declared bankruptcy — blaming the coronavirus pandemic for its current financial hardships.

Bogota, Colombia-based Avianca Holdings, the second oldest airline in the world, declared Chapter 11 bankruptcy in New York Sunday. If the 100-year-old Avianca can't recover, it could become the first airline to fall victim to the pandemic.

While Reuters reports the airline was already in trouble prior to the coronavirus, the pandemic has heightened matters. Avianca reports it has lost 80% of its consolidated revenue and hasn't paid most of its 20,000 employees since late March.

The airline has been seeking financial assistance from the Colombian government, but so far it has been unsuccessful.

Avianca's struggles line up with a rattled travel industry in the wake of the coronavirus. The Associated Press reports 90% of global flight traffic is halted due to the virus.