National Carrier Of Czechia is Declared Bankrupt


Czech Airlines Declared Bankrupt

Just this week, the 5th oldest airline, Czech Airlines, has been declared bankrupt by the Court Of Prague. The Airline was in debt to 266 creditors, which are mostly suppliers and 300,000 passengers awaiting refunds for canceled flights. All the total Debt rounds up to 80 million dollars.

It is Now safe to say that the future is uncertain for this airline. The Insolvency Registration lists the Airline as bankrupt, with INSKOL being the insolvency administrator. The Court has asked the creditors of CSA to register their claims ahead of their Meeting in June. The Insolvency Administrator is not sure to ground the fleet or sell their assets. At this time, Czech Airlines Flights Are flying, but at an significantly reduced
rate.

The Airline has removed its ATR fleet and now only has 3 planes remaining. The Court has formed an interim committee of the creditors for the process of insolvency proceedings. The Committee contains representatives of CSA’s banks, suppliers and even a passenger named Tomáš Hefr. The passenger was reported to be awaiting a refund of 7200 CZK. Commenting on his place on the committee of creditors, the passenger said:

“I use the debtor’s services on a regular basis. I consider myself a regular and loyal customer of the debtor and I believe that my membership in the Provisional Creditors’ Committee could contribute to the overall benefit and interest of all creditors, especially passengers.”

The insolvency proceedings have so far revealed that 266 of ČSA’s creditors are owed CZK 800 million ($36 million). This group contains all the suppliers to the airline. At the same time, there is as many as 230,000 passengers who have been identified as creditors too, because they are owed money for the flights that Czech Airlines had canceled. The total amount of money owed here is as high as one billion Czech Koruna ($46 million).

Last month, ČSA sent a letter to the Employment Office of the Czech Republic to inform it that it would be dismissing its whole workforce of 430 people. The news was the first strong sign that the airline was on the brink of collapse. The news came just several days before the expiry of an emergency moratorium on the airline’s debts at the end of February.

Then, just days later, Czech Airlines filed a reorganization proposal under Czechia’s insolvency law. The carrier had exhausted all of its available survival options by that point: it faced a huge drop of revenue in 2020 due to the pandemic, but the Czech government has offered it no financial assistance.

What is Czech Airlines?

Czech Airlines j.s.c. is the flag carrier of the Czech Republic. Its head office is on the grounds of 6th district Prague, Vokovice. The airline’s hub is at Václav Havel Airport Prague. The company operates mainly scheduled flights and serves 22 destinations as of 2021.

Sources

Czech Airlines Declared Bankrupt After Previously Laying Off Staff - Simple Flying
OK-HEU | Airbus A320-214 | CSA Czech Airlines | Oleksandr Smerychansky | JetPhotos
Czech Airlines - Wikipedia

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This is sad actually. Knowing that a very well recognised airline representing the areas of Czech to fall bankrupt seems odd. I am wondering wether Czech Airlines was ever funded by the government, knowing that it should be a state owned airline?

I really love the airline’s livery and I will miss the daily activity of the red and white aircraft.

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The Creditors:

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It was strange though that they got no funding

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The Etihad curse strikes again :(

Edit: Nvm, I was thinking of Serbia lol

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