Avianca Files For Chapter 11 Bankruptcy In The US

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Update: Lifemiles has put out a statement that they have a strong balance sheet, remain separate from Avianca, and will continue normal operations as Avianca proceeds through Chapter 11.

While technically true, if Avianca were to go out of business, Lifemiles would lose their ability to book Star Alliance award tickets.


Avianca has filed for Chapter 11 bankruptcy in the US as it looks to reduce debts between $1-$10 billion, after their home country of Colombia refused a bailout. The airline had struggled even before coronavirus hit.

Avianca’s most useful aspect for mileage junkies is their Lifemiles program, which has mileage bargains for Star Alliance flights on airlines like United. United has also invested in Avianca in the past, as it looked to maintain weak Star Alliance coverage in South America.

Traditionally airlines look to save people’s mileage balances in bankruptcy as mileage programs are often the only profitable part of the airline. Hopefully that happens with Lifemiles as well, but it’s another reminder that you should keep your mileage balances with banks that can transfer points to miles on demand instead of storing them with airlines.

Do you think Avianca and Lifemiles will make it through Chapter 11 unscathed?

HT: Elikip, via DDF

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28 Comments On "Avianca Files For Chapter 11 Bankruptcy In The US"

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No

What are miles worth in a bankruptcy?

Tom

What happens with flights already booked?

Junkyardunz

Dan how are you liquidating your Lifemiles if you have any?

Al

How would any reader have sufficient information to answer whether AV reorganizes successfully? We have no clue. I’m glad I burned all my LMs during February.

traveler

I have 170k miles there, was planing on using them now. What will happen to the miles. How should I find out what the outcome will be?

Avi

So the miles in my account are useless now?

ari

I have tickets booked on Austrian air with lifemiles for Succos. Should I be concerned?

PM

Yes

Mendy

Why?

DC

Do you think refunds “in process” already with Avianca for flights cancelled by COVID-19 (which they say take up to 30 days) are at risk? Should I do a credit card chargeback to be safe?

1991

Any idea when will we know if the airline will survive?
I have flights booked with them for December..

Eliyahu

Avianca
Aviancanews@avianca.com
To
****@email.com
Show less
May 10 at 11:59 AM

Estimado Sr Elias.

Lamentamos informar que Avianca entro en convocatoria de acreedores.

Todos los pasajes emitidos en el Grupo Lufthansa son nulos. Por ende su reservas fueron canceladas.

Su viaje a Israel con Austrian Air y Lufthansa para Octubre 2020 son nulas y estamos en proceso de reintegro.

Lamentamos el momento ingrato.

Saludos cordiales.

Josefa Villegas.

Uwdsr

Are they saying that previously issued tickets using Lifemiles for any airlines in the Lufthansa group are void?

A

I’m sitting on 115k LM because of a previously cancelled flight. If I book a spring 2021 partner flight but Avianca/LM are liquidated, does my ticket get cancelled or will I still be able to fly?

Uwdsr

If I have tickets purchased with Lifemiles on United metal and Avianca or Lifemiles go under, will United still honor those tickets? They are already paid for.

eli

Dear customer,

Because our relationship with you is important, I wanted to reach out directly to let you know about the actions Avianca is taking to make sure we have the financial strength we need to continue serving you well into the future.

Today, Avianca voluntarily filed for reorganization proceedings under Chapter 11 of the United States Bankruptcy Code. We did so to protect our business as we continue to navigate the effects of the COVID-19 pandemic as well as comprehensively address our debt and other commitments. We considered many other possibilities before determining that a reorganization made possible by the Chapter 11 process is the best path forward to protect the essential air travel services that we provide across Colombia and important locations throughout South America, Central America, North America and Europe.

Avianca has flown the skies for more than 100 years, and we are committed to our purpose to connect people, families and businesses. We look forward to returning to the skies and helping you and your organization safely travel across Latin America and the world.

Here is what you need to know:

Avianca will continue to operate through this process, and Avianca will return to the skies and continue to fly once COVID-19 travel restrictions are gradually lifted.

Customers’ safety and well-being remain a top priority for us today and moving forward. Customers can be confident that they can continue to depend on Avianca for safe, reliable air travel and high-quality service. To that end, Avianca has implemented a number of measures to ensure the safety and well-being of our employees and customers. Additional information on the steps Avianca has taken can be found here.

Customers can expect to continue to arrange travel and fly with Avianca in the same way they always have. We plan to honor all customer programs throughout this process.

• Customers will be able to use tickets, vouchers, travel coupons, gift cards and any additional travel services purchased before we initiated this process.

• Additional frequent flyer benefits remain active, including access to VIP Lounges, priority check-in, upgrades and other benefits.

• Given the impact COVID-19 has had on travel plans, we will continue with our Flexibility Policy. Subject to government policies, we expect to continue to allow changes free of penalty and fare difference charges for previously booked tickets and/or newly purchased as long as the original and changed flights are until October 31, 2020. All customers who have booked travel or will purchase flights during this period can be confident they can rely on Avianca for their travels.

• The LifeMiles™ program is administered by a separate company and is NOT part of Avianca’s Chapter 11 filing.

• Avianca customers will continue to accrue miles when they fly with Avianca, and can continue to redeem miles earned through LifeMiles™ to purchase tickets with Avianca during this process. Tickets purchased through redemption of LifeMiles™ miles will continue to be exempt from penalty fees until October 2020.

We are proud of our 100-year legacy, and look forward to continuing to serve you. Thank you for your continued loyalty.

ari

What does that mean that Lifemiles is a separate entity and is not affected by the bankruptcy?

Jack

Yes

the big x

Hi Dan, I’m sitting on 300k Marriott points.Any word about them filing for bankruptcy? Thanks

Isaac Friesel

So again, what should I do with my Lifemiles. Is it still worth something?

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