AirBaltic Files for Chapter 11 Amid Aviation Turbulence

Latvia's airBaltic has voluntarily filed for Chapter 11 bankruptcy in the U.S., aiming to restructure its debt amidst the Iran war-induced crisis in the aviation sector. The airline, largely government-owned, plans to continue operations, maintaining flights and services during the restructuring, scheduled for completion by June 2027.

Latvia's national airline, airBaltic, announced on Monday its decision to voluntarily file for Chapter 11 bankruptcy in the United States, a move to alleviate severe financial strains exacerbated by the sector-wide crisis linked to the ongoing Iran war. This marks the second significant airline setback following the collapse of Spirit Airlines in May.

AirBaltic, established in 1995 and significantly owned by the Latvian government, has been the dominant airline in the Baltic region, operating an extensive network of flights across Europe and beyond. Despite transporting over 5.2 million passengers last year and generating substantial revenue, the airline reported a net loss due to rising expenses and market turmoil.

Despite financial troubles, airBaltic assures stakeholders that operations, including flights and customer service, will persist smoothly throughout the restructuring process. The airline has secured considerable debtor-in-possession financing, subject to court approval, aiming to finalize its financial reorganization by 2027.