The German airline Germania has filed for insolvency and all flight operations have been suspended during Monday night local time, the airline announced on Tuesday.
“Unfortunately, we were ultimately unable to bring our financing efforts to cover a short-term liquidity need to a positive conclusion,” said Karsten Balke, CEO of Germania.
Financial problems at Germania Airline had become known in early January when Germania was looking for a loan or selling stakes to close a gap of at least 20 million euros (22.8 million U.S. dollars) in order to keep operations going throughout the winter.
Germania attributed the insolvency to a sharp rise in kerosene prices during the summer of 2018 in combination with a depreciation of the euro against the U.S. dollar. Also, the German airline had faced “considerable delays in phasing aircraft into the fleet” and an “unusually high number of maintenance events”.
Germany’s largest airline Lufthansa announced that it will offer discounted tickets to customers of the insolvent airline Germania. As a result of the insolvency, “another special situation for the aviation industry in Germany” had occurred, Lufthansa stated.
Germany’s second largest airline Air Berlin had gone bankrupt in 2017. Around 8,000 employees were affected by the Air Berlin insolvency. Eurowings, a subsidiary of Lufthansa, subsequently took over 77 aircraft from Air Berlin.
Germania was founded in 1986. Most recently, the company carried about 4 million passengers per year with 37 aircraft on short and medium-haul flights to destinations in Europe, North Africa as well as the Near and Middle East.
Source: Xinhua, February 5, 2019