Mexicana strikes deal with cabin crew

Mexicana strikes deal with cabin crew

Mexicana de Aviación has secured a potentially significant victory as it battles for survival, with cabin crew at the troubled airline agreeing to defer wages.

Cabin crew agreed to postpone payment by two months while also agreeing to cut their food allowance by half for two weeks in order to assist the airline as it struggles for survival.

Meanwhile, the pilots union said it would be prepared to make similar concessions but offered no details. The union is also seeking additional external investment for the airline, with analysts suggesting AeroMexico as a potential buyer.

There was no comment from Mexicana following the latest developments.

Both cabin crew and pilots have staged protests in Mexico City in recent days, as Mexicana seeks to cut costs. Pay cuts of up to 40 per cent have been mooted, while large scale redundancies are also possible.

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Bankruptcy Protection

The airline – the largest in Mexico – filed for bankruptcy protection last week citing debts of over $1 billion.

The financial situation has since “seriously deteriorated” the airline said yesterday, forcing the cancellation of international flights - including those from London Gatwick.

Before its bankruptcy action, Mexicana operated 220 flights a day to 65 cities, almost all of them in foreign countries.

It carried 11.1 million passengers in 2009.

However, the airline owns just nine of the 63 aircraft it operates, with leasing companies issuing termination contracts. To date at least three of its planes have been grounded on creditors’ concerns over the airline’s payment capacity.

Subsidiaries MexicanaClick and MexicanaLink – which operate domestic flights - are not part of the bankruptcy filing.