Airline insolvencies in Germany: Questions and challenges for aircraft lessors
16 March 2020
Airlines under pressure
The market for airlines is under extreme competitive pressure. We have seen some recent examples of European airlines that have gone into insolvency proceedings (Air Berlin, Condor, Germania, Monarch, Small Planet, Flybe). Airlines are struggling with volatile commodity markets and political instabilities (trade wars, protectionism). In addition, the Covid-19-Crisis (‘Coronavirus’) is leading to further distress.
Flight routes have been suspended and in March 2020, the U.S. government has cancelled all air travel from the EU to the U.S. UK regional airline Flybe had to file for administration in March due to a Covid-19 related liquidity shortfall. Just days after the Flybe insolvency, Norwegian Air Shuttle had to receive state aid from Norway. Other airlines are considering asking for state-aid to overcome the Covid-19 crisis.