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Mexicana Airlines Sued for $841 Million by Texas Company

-Editorial

Mexicana Airlines is facing a lawsuit totaling at least $841 million filed by a Texas company, alleging multiple breaches of contract that impeded its assistance in launching the carrier. 

The complaint, lodged in Manhattan federal court, detailed Mexico’s government enlistment of the plaintiff, SAT Aero Holdings, last year to furnish various services to Mexicana. These services include procuring aircraft and associated insurance, alongside recruiting and training pilots and crew members. SAT Aero Holdings contended that Mexicana consistently defaulted on its commitments, starting with the non-payment of $5.5 million in aircraft lease deposits. 

Additionally, Mexicana’s refusal to execute documents, poaching SAT’s pilots and crews, and its failure to secure necessary licenses for importing and operating planes in Mexico were highlighted as breaches. The complaint asserted that Mexicana’s “material breaches” and reluctance to collaborate left SAT with no recourse but to litigate. SAT, headquartered in San Antonio, sought damages totaling $838.5 million, comprising the entire contract value, along with incurred expenses exceeding $2.4 million.

In response, SAT stated, “SAT has endeavored to work with the Mexican Ministry of Defense to resolve these issues. But, instead of remedying these several breaches, Mexicana Airlines has, confoundingly, instead sought to impose financial penalties on SAT and hold it responsible for the failure to deliver any of the aircraft identified.”

History of the Airline

Established on June 15, 2023, Aerolínea del Estado Mexicano S.A. de C.V. (Mexicana de Aviación) operated as a Majority State Participation company. Its mission aimed to enhance air service quality and coverage while fostering market connectivity to spur national and international growth, development, and competitiveness.

Mexicana de Aviación, as per its website, served to unite Mexico’s regions and bolster commercial, social, tourist, and cultural development by facilitating passenger and cargo transportation to key domestic destinations. The airline’s history traced back to August 28, 2010, when operations ceased amid a judicial process, culminating in bankruptcy declaration, including its subsidiaries. 

In 2022, the Mexican Army and Navy evacuated Mexicana’s former facilities at the Mexico City International Airport. Mexicana’s final flight, MX 866, departed from CDMX to Toronto, Canada, on August 28, 2010, at 04:15 p.m. Its headquarters were situated in the old Mexican Aviation Tower, now AXA México Tower, in Colonia del Valle, Benito Juárez, CDMX. The announcement on July 10, 2023, by President López Obrador signaled the acquisition of Mexicana’s brand and assets, which would fall under SEDENA’s jurisdiction, slated for December 1 of the same year. On August 10, 2023, Mexico’s Secretary of the Interior, Luisa María Alcalde, disclosed the government’s purchase agreement for Mexicana de Aviación’s brand, involving more than 7,000 current and retired employees, for 815 million pesos (approximately $48 million).

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