Mexicana files for bankruptcy

Not a huge surprise considering that the carrier had been slashing service all over the country, including four daily flights out of LAX. Mexicana says operations will continue during the reorganization, although if you have reservations it would be a good idea to check on the status of your flights. From Reuters:

Talks between the managers and union workers of Mexicana de Aviacion reached an impasse on Monday. Managers of the 89-year-old Mexican airline, with a debt of close to 10 billion pesos ($796 million), want to sharply cut wages and staff to keep the company running, but workers refuse to have their benefits shrink further. Mexicana said on Monday that to keep the airline afloat, pilot and flight attendant wages need to be slashed by close to 40 percent. Pilots and attendants are reluctant to accept a new round of pay cuts since they already gave up multiple benefits in 2006, saving Mexicana around $35 million per year.

The airline flew about 500,000 passengers into and out of LAX during the first six months of the year. That's a lot for a foreign carrier, but it only represents a 2 percent market share at the airport.