Image credits: Unsplash
News Article

Despite Bankruptcy Filing, Interjet Remains Optimistic

By Antonio Gozain | Tue, 08/10/2021 - 16:16

Mexican airline Interjet filed for bankruptcy months ago, aiming to reorganize its US$1.25 billion debt. Despite this, the company remains optimistic regarding a decision the Sixth District Court for Civil Matters of Mexico City will make in the following weeks.

“Currently, the commercial bankruptcy process, in its conciliation phase, is continuing and we are optimistic that shortly, the judicial authority will allow this process,” said Carlos del Valle del Río, Interjet’s spokesman, in an official press release.

Interjet’s problems began years ago but the COVID-19 outbreak ended up putting the company in a worse position. In 2018, the airline added Russian Sukhoi aircraft to its fleet, but technical problems forced Interjet to ground the planes and eventually return to an Airbus-only fleet, acquiring a debt regarding the Sukhoi aircraft.

The US$1.25 billion are owed to a variety of entities, including government institutions, such as the Navigation Services in Mexican Air Space (SENEAM), SAT and SCT, in rights of use of air space, taxes, jet fuel and customs. Interjet also owes its employees, which formally started a strike in January 2021, making December 11 the last day the airline operated a commercial flight.

The financial restructuration that began with the file for bankruptcy aims to bring back Interjet’s commercial operations at an undetermined point, originally thought to be 2022. However, the airline is reformulating its goals, said Valle del Río, and now aims to cover the first responsibilities a company has when going to bankruptcy: pay its workers.

“(Interjet’s) focus is getting to January 2022 with a normalized scenario, without the strike and with the main obligations covered; that is the goal we still have,” he said.

The air routes Interjet used to cover are now being exploited by Volaris, Aeroméxico and Viva Aerobus. The three airlines continue recovering from the pandemic, but Volaris now holds the lead with 40.5 percent of domestic traffic and recently announced plans to hire 2,000 new employees and add 25 new aircraft to its fleet.

Interjet’s path to a comeback in 2022 hinges on a positive outcome in the authorities’ decision regarding the bankruptcy. However, the airline stated that it has already made contact with its creditors to start moving forward with negotiations. “At the same time, we have established communication channels with our creditors in order to find ways that allow us to build agreements that generate certainty and viability for the future of the company,” said del Valle del Río.

The data used in this article was sourced from:  
MBN, Interjet, Volaris
Photo by:   Unsplash
Antonio Gozain Antonio Gozain Journalist and Industry Analyst