Pluna Air, Uraguay’s flagship airline, has suspended operations indefinitely due to debts, cash flow problems and a strike.
“The economic and financial situation of the company makes it impossible to ensure proper operations” said a press statement from Pluna adding that the company will provide all the resources available to contact the passengers affected by these circumstances in order “to seek the best possible solution”.
“Of the 900 people working for Pluna, in Uruguay and overseas, 720 will collect unemployment insurance” said Public Works and Transport minister Enrique Pintado, from whose office the bankrupt airline depends.
“The problem of Pluna is financial and of liquidity and that is why it can’t fly any longer in current conditions. On Monday the cabinet will address several options that are under consideration including an urgent bill on the issue” said Pintado.
If the airline cannot raise more funding, its investors are likely to seize assets to try recover some of their investment.