Slammed by Coronavirus Shutdown, Avianca Files Chapter 11 Bankruptcy

Colombia-born Avianca — Latin America’s oldest airline – on May 10 filed for Chapter 11 bankruptcy in U.S. federal court because of the Coronavirus shutdown.

Its majority shareholders today are U.S.-based United Airlines and Kingsland Holdings. For the filing, the company cited US$10 billion in liabilities along with inability to generate income to cover continuing expenses.

“We did this to protect our business while continuing to face the effects of the Covid-19 pandemic, as well as to comprehensively manage our debt and other commitments,” according to Avianca’s official press statement.

“We hope to return to heaven and help you visit, more safely, the people and places they love. Avianca will return to the skies and continue to fly once the travel restrictions generated by Covid-19 are gradually lifted.

“Avianca has submitted requests to maintain its [customer loyalty] client programs throughout this process, so clients can trust to continue organizing trips and flying with Avianca in the same way that they always have.

“Likewise, customers can use the tickets, vouchers and gift vouchers purchased before Avianca started this process. Additionally, they will continue to earn miles when they fly with the airline, and may continue to redeem the miles earned through ‘LifeMiles’ to purchase tickets with Avianca during this process.

“Avianca also hopes to continue issuing ticket refunds and honor travel bonuses and payments or credits associated with baggage or service claims in accordance with its customary policies.

“Subject to government policy, we hope to continue to allow multiple changes, with no penalties or fees for fare differences for previously issued and/or new tickets purchased as long as the original and changed flight is until October 31, 2020. All customers who have booked or are going to buy flights during this period can be sure that they can trust Avianca.

“Tickets purchased through ‘LifeMiles’ mile redemption will continue to be free of penalties until October 31, 2020,” the company added.

Avianca earlier this month was forced to cancel promotion of unauthorized flights inside Colombia because the Colombian government has banned all air travel through at least May 30.