Tag Archives: Air mauritius bankrupt

Struggling Air Mauritius has entered voluntary administration after the board resolved that with the coronavirus grounding it would not be able to meet its financial obligations in the foreseeable future. Air Mauritius had already embarked on a transformation programme in January this year under which it was reviewing its business model in a bid to secure sustainability. Air Mauritius has become the second airline to enter administration proceedings in as many days voluntarily. Yesterday Australian carrier Virgin Australia also entered voluntary administration caused by the current crisis. In a company statement the airline’s board of directors state that while “substantial progress” was made in developing its action plan, the closure of borders and halting of air services because of the coronavirus has led to a “complete erosion of the company’s revenue base”. Air Mauritius was forced to suspend flights at the start of April because of the coronavirus restrictions. The airline’s board came to a decision following “a complete erosion of the company’s revenue base.”  In its letter, the airline stated that its entire revenue base had been eroded. The erosion has been caused by a decrease in demand tied to many different travel bans enacted by separate national governments. The airline believes that demand will not begin to return until the end of 2020. “There is uncertainty as to when international air traffic will resume and all indications tend to show that normal activities will not pick up until late 2020,” the airline says.    

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