Photo: Interjet


After abruptly cancelling all of its flights on Sunday, Nov. 1, and Monday, Nov. 2, Mexico’s third-largest airlines Interjet seemed to be on the verge of bankruptcy this week as rumors flew over buyouts and employee culling

As of Thursday, Nov. 5, the low-cost airline’s website remained down, leaving nearly 3,000 passengers stranded, with no information as to whether their flights would be rescheduled or if they would be eligible for a refund.

The airline has struggled to manage the financial fallout from travel restrictions since the covid-19 pandemic hit Mexico in March.

Initially, Interjet responded to border closures by offering passengers a free flight changes, but refused to provide refunds or full cancellations for clients who had not purchased “priority tickets.”

However, the tickets Interjet offered for rebookings were offered their clients at elevated prices, leading to complaints from customers as to how the company has managed the covid-19 crisis.

As international flight restrictions were extended, Interjet cancelled overseas flights, offering clients no option other than rescheduling for a later date.

According to Aeropuertos y Servicios Auxiliares (ASA), the state-run company that provides fuel to airlines, Interjet owes $55.7 million in fuel, and the Interjet employees union recently announced that its members hadn’t been paid in over two months.

Interjet was already in hot water with Mexican aviation authorities long before the pandemic hit.

In January 2018, it refuted claims that it was cannibalizing airplanes — an industry term for the practice of scrapping airplanes for parts in order to keep other jets running.

At the time, Carlos Ozores, an air transport specialist at the aviation and aerospace warned that “there (were) doubts about the viability of the business.”

Those doubts are now certainties, as the airline has acknowledged that it is out of funds.

On Tuesday, Nov. 2, Mexico’s Interior Secretariat organized a meeting between Interjet, its workers and representatives of the aviation workers branch of the Mexican Workers Congress (CTM) in response the the unpaid workers’ complaints.

During that meeting, Interjet agreed to pay its workers two weeks’ worth of wages later this week.

A group of investors led by Mexican financiers Carlos Cabal Peniche and Alejandro del Valle had offered to purchase 90 percent of Interjet’s shares under a $150 million ¿deal that had been announced in July.

However, in light of recent developments, it is unclear as to whether this purchase will go ahead, as there is concern among the investors that the government could claim assets to cover a backlog of unpaid taxes.

The unpaid taxes are estimated to amount to 550 million pesos.

Last year, authorities attempted to seize control of the company’s bank accounts in an effort to collect the money the company allegedly owed, but were unsuccessful in their attempt to garner the funds.

According to a February report by Mexicanos Contra la Corrupción, a watchdog organization that looks to hold companies accountable for corruption, Interjet’s total outstanding debt could amount to $143 million.

…Nov. 6, 2020

Leave a Reply