Colombian Ultra Air in difficulties due to low liquidity

the market of air Transport in Colombia continues to experience difficulties; On Thursday the Superintendence of Transportation, in charge of monitoring the sector, imposed on the airline Ultra Air Urgent measures to safeguard the provision of the service when the company is experiencing low liquidity.

It is the second low-cost Colombian airline to report financial problems in recent weeks. Viva Air suddenly suspended its operations on February 27, leaving thousands of passengers adrift at airports in Colombia and Peru, citing a financial crisis.

Ultra Air began operations in February 2022 with domestic routes to destinations such as Bogotá, Medellín, Cali, Santa Marta and Cartagena. It has an approximate share of 6% in the domestic market and planned to invest 30 million dollars in the next five years, create 22,000 jobs and expand its operation with routes to Mexico, Ecuador, Peru, Aruba and the United States.

The Superintendency warned in a resolution that Ultra Air presents “low liquidity, which makes it difficult to commit to short-term obligations, generating a risk of default with your creditors”.

Consequently, it ordered him to inform him about decision-making when there is an economic and operational risk that affects the provision of the service, as well as the negotiations for its capitalization and the implementation of a passenger management plan in the event of a possible cessation or suspension of operations.

After the decision of the state authority, Ultra Air informed through its press office that it will suspend the sale of tickets until April 30 in order to “reorganize the operation in order to comply with the passengers and avoid setbacks”.

Source: AP