While the biggest airline bankruptcy announcement of 2024 has been the beleaguered Spirit Airlines (SAVE) , a number of other airlines have run into similar problems and suffered similar fates.
In January 2024, Brazilian low-cost carrier GOL Linhas Aéreas (GOL) announced filed for Chapter 11 protection in the U.S. It had amassed more than $3.8 billion in liabilities waiting for delayed Boeing (BA) planes and was struggling with operations under a growing debt load.
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Airline proposes bankruptcy exit plan, promises ‘important milestone’
GOL announced on Dec. 10 that it filed a reorganization plan that promises to convert $1.7 billion of debt into equity and raise $1.85 billion of new financing through new investors. This includes transferring approximately $950 million in new equity, with the possibility of a larger amount in the future, to its parent holding company Abra in exchange for it erasing $2.8 billion in debt.
“With resolution of these issues, the debtors will be well-positioned to begin raising the necessary exit capital required by their business plan and engaging with their other creditor constituencies,” it said.
“The filing of the Plan represents an important milestone toward the successful completion of GOL's financial and operational restructuring and implements a significant investment of new capital to support GOL's business,” the airline said in a statement.
With the debtor working to obtain confirmation of its Chapter 11 plan from a New York bankruptcy judge, GOL has recently also applied for a deadline extension to continue negotiations with creditors who financed the lease of 139 aircraft and 58 aircraft engines, all the while refining its long-term business plan.
Related: Spirit CEO says airline will not file for bankruptcy
‘Efforts to strengthen our financial position and drive GOL’s long-term success’
"Reaching this agreement is another important step in our efforts to strengthen our financial position and drive GOL’s long-term success," GOL CEO Celso Ferrer said in a statement.
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Commencing operations in 2001 out of Rio de Janerio, GOL has quickly grown to be among the largest airlines in South America — in 2024, it was behind just Chilean LATAM (LTMAQ) and Colombian Avianca Group (AVHOQ) by the total number of passengers carried.
But despite high ticket sales, GOL has run into financial problems that initially started to accumulate amid the drop in traveler numbers during the Covid-19 pandemic and, later, its inability to restart operations amid the delay of Boeing deliveries. The latter has been an industry-wide challenge that also affected airlines such as United (UAL) , but the latter was able to work around it with a bigger base fleet.
Along with Spirit, other airlines that have had to either file for bankruptcy protection or fully cease operations in the last few months include Estonian low-cost carrier Nordic Aviation Group (better known by the brand name Nordica) and north-of-the-border carrier Canada Jetlines.
After racking up more than $11.8 million CAD (roughly $8.7 million USD) in debt and struggling to find an investor to rescue it, the budget airline initially launched to shuttle Canadian tourists to warm destinations such as Florida and Jamaica started canceling flights. Three of the airline’s executives and CEO Brigitte Goersch walked out before the final bankruptcy announcement was made.
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