Avianca, one of Latin America’s largest airlines, filed for Chapter 11 bankruptcy in the U.S. Southern District of New York. Avianca blamed the bankruptcy on the “unforeseeable impact of the COVID-19 pandemic,” begging the question of which airline is next? Virgin Australia faced a similar situation last month after failing to obtain a government bailout; Flybe, based out of the United Kingdom, entered administration citing an inability to withstand the pandemic; and the future of South African Airways hangs in the balance in the face of years of financial uncertainty and the outbreak. All airlines in Latin America could be looking at a similar fate without a government bailout.

According to a recent MarketWatch article, Boeing’s David Calhoun, chief executive, estimated it could take three to five years for the industry to recover to pre-pandemic levels. It is estimated airlines have distributed $10 billion in vouchers since March, but with the threat of bankruptcy looming, there are no guarantees for consumers either.

Avianca, founded in 1919, positioned itself as the world’s second-oldest continuously running airline. In 2019, it was third-largest airline in Latin America and is part of Star Alliance. A holding company affiliated with United Airlines bought a majority stake in Avianca last year. The bankruptcy decision was made to “protect and preserve operations.” The airline will also shut down its business in Peru. Avianca usually has 189 planes in its fleet, and the shutdown reduced its revenue “by over 80 percent and placing significant pressure on its cash reserves.”

Are you worried about your preferred carrier’s fate following the COVID-19 pandemic?  Tell us about it. Email us at [email protected]. Please include your full name and location.