Air Mauritius, the flag carrier airline of Mauritius, entered into "Voluntary Administration" yesterday.
The airline's board of directors made the decision yesterday to place the airline into administration because unfortunately, the airline was struggling financially before the COVID-19 crisis. Other airlines have been forced to add liquidity to avoid bankruptcy and to keep their airline afloat. Some are already showing signs of sinking like South African Airways and Virgin Australia.
According to Onemileatatime.com, the management at Air Mauritius had set up a "Transformation Steering Committee" which had an intention to discuss and address the financial situation of the airline. Although some progress was made, the COVID-19 crisis has caused much more serious financial damage. Due to the doubt of when the skies will be normal again after the COVID-19 Crisis, Air Mauritius is left without many options to resolve their financial situation.
Due to the COVID-19 Crisis, travel bans are not expected to be lifted quickly. Although many experts are suggesting that travel will be partly back to normal, passenger demand, destination availability, and profitability are a huge factor in determining the near-future of the airline industry.
Also, according to onemileatatime.com, over the past few years, Air Mauritius has dealt with financial problems. Last year, the airline reported a 30 Million Dollars USD loss, but the year before that, the airline earned a marginal profit of 5.2 Million Dollars.
Currently, the airline has a fleet of 13 aircraft that is primarily comprised of aircraft from the European manufacturer, Airbus. The airline previously had 4 Airbus A350-900, but they leased two of those A350's to South African Airways. Unfortunately, South African Airways is in a even worse financial situation and is on the brink of collapse.
Air Mauritius is not the only airline that has entered administration. Earlier this week, Australia's second largest airline, Virgin Australia entered Voluntary Administration.
What are your thoughts on the situation? Let us know in the comments below.
Credits: onemileatatime.com , simpleflying.com , Samchui.com
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