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News Article

Interjet Links Four Days of Cancellations

Wed, 12/02/2020 - 10:35

Mexican airline Interjet cancelled flights from Saturday, Nov. 28, to Tuesday, Dec. 1, affecting thousands of passengers and leading authorities to reiterate their warnings against buying their tickets. Airports and Auxiliary Services (ASA) explained that the airline had failed to pay for jet fuel during those four days. Early this morning, El Economista reported that the airline had failed to pay for jet fuel for Wednesday, Dec. 2.

Interjet has been accumulating debt to several government institutions since last year but its troubles only worsened after the COVID-19 crisis. The airline reported a 66.1 percent contraction in passenger traffic during the first eight months of 2020. Just in August, the airline saw a whopping 97.2 percent year-on-year drop in passengers. These troubles hurt the airline’s liquidity and led to several flight cancellations throughout the year. Less than a month ago, Interjet also cancelled all its flights for two consecutive days, which led the Bureau of Consumers’ Protection (PROFECO) to issue a warning against the airline on Nov. 3. Ricardo Sheffield, Director of PROFECO, warned that the airline was at the brink of bankruptcy. At the time, Interjet apologized for the disruption and claimed that it would “return to regular operations.”

Yesterday afternoon, PROFECO released a second warning against the airline asking consumers to evaluate the risk of buying their tickets. The warning points out that the bureau had identified “a significant reduction of its fleet, the suspension of routes, recurrent cancellations of its flights, grants of thousands of flight vouchers that consumers have been unable to use due to subsequent cancellations, failure to pay compensations corresponding to 25 percent of the ticket price and lack of liquidity to maintain the minimum operational capability concerning payment of jet fuel.”

Interjet’s troubles can be traced back to the airline’s acquisition of Russian Sukhoi aircraft in 2018, which were later grounded due to technical problems. The airline would later accumulate debt for millions of dollars to several government entities, including the Navigation Services in Mexican Air Space (SENEAM), SAT and ASA for the rights of use of air space, taxes, jet fuel and customs. The airline also has debts with its private lessors and union, though with the latter it negotiated an agreement to cut down salaries by 50 percent in October.

The Mexicans Against Corruption and Impunity (MCCI) organization pointed out that the airline owed government entities millions. Debts to SAT amounted to MX$2.9 billion (US$137 million) during October and led to several property seizures.