NEW YORK — AirBaltic filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court in New York on September 14, 2026. The Latvian flag carrier stated that the restructuring process will not affect flights and that reservations and ticket sales are expected to continue as scheduled.

The airline secured €350 million in debtor-in-possession financing from lenders including Strategic Value Partners, Barclays, and Morgan Stanley at a Secured Overnight Financing Rate (SOFR) of 8%. This amount represents a 36.2% rise from the more than €257 million in short-term funds the company had previously secured earlier in September 2026.

Local bondholders holding over 70% of the value of AirBaltic's debt refused additional loans, contributing to the decision to seek court protection. AirBaltic plans to reduce its fleet of 50 Airbus A220-300 planes and restructure its debts as part of the proceedings. "AirBaltic has been experiencing acute financial stress due to a combination of financial and geopolitical factors," the AirBaltic board stated in the bankruptcy filing.

Latvian Prime Minister Andris Kulbergs supported the move in an official statement. "I view this solution as one of the best options for ensuring airBaltic's viability, as it provides the necessary tools and time to implement the restructuring plan," Kulbergs said.

AirBaltic is majority owned (88.37%) by the government of Latvia. The airline operates flights to over 80 European and Middle Eastern destinations from Latvia, maintaining bases in Tallinn, Vilnius, and Tampere along with a seasonal base in Las Palmas launched in 2023.

What's New

Additional details from the filing indicate that AirBaltic has an estimated 10,001 to 25,000 creditors, according to its filing with the US Bankruptcy Court. Among these obligations, the largest unsecured claim stands at 66.518 million US dollars and is held by Pratt & Whitney.

The company plans to complete the Chapter 11 process by around June 2027, subject to the necessary approvals from the US court. This timeline extends the current operational footprint, which includes the majority government ownership and regional bases established in recent years.

Why It Matters

The filing occurs within a broader period of instability in the global aviation sector, where multiple carriers have faced closure or regulatory action in 2026. Spirit Airlines canceled all remaining flights on May 2, 2026, marking the largest airline shutdown of the year, while Magnicharters, a Mexican low-cost airline, filed for bankruptcy protection in May 2026.

Other regional operators also ceased operations during this period. Jetflite, a Finnish carrier, began winding-down operations in May 2026 and canceled all charter flights for 2026. European Cargo, a British cargo airline, entered administration in June 2026, and AlpAvia, a Slovenian charter airline, shut down in March 2026 due to financial problems. Starflite Aviation had its AOC license revoked in March 2026 after the FAA claimed that owners falsified pilot training records.