Kenai Aviation Halts Flights Amid Mounting Post-COVID Debt

Kenai Aviation (KNW, Kenai) has suspended all flight operations as of November 3, 2025, citing unsustainable debt accumulated during the COVID-19 pandemic.

“We are financially insolvent,” owner Joel Caldwell said in a statement. “COVID gave us a debt load that we haven’t been able to get back on top of. Carrying that burden amplified the impact of every obstacle we’ve faced. When our aircraft was grounded for maintenance and we couldn’t serve Unalakleet this summer, it hurt both the community and us financially.”

Caldwell noted that while day-to-day operations remained viable, the airline could no longer service its long-term obligations. “We need capital, we need partners, we need a lifeline. That investor is out there—we just need to find them,” he added.

Kenai Aviation operated as a Part 135 carrier with a small fleet of three Tecnam P2012s, one King Air B200, and one Cessna U206F. The regional carrier primarily served the high-frequency Anchorage–Kenai route and provided Essential Air Service (EAS) flights from Anchorage to Seward under a contract through April 2027. It also operated unsubsidized EAS flights to Unalakleet, a route awarded after Ravn Alaska’s collapse. However, the U.S. Department of Transportation recently began seeking a new operator following community criticism over Kenai’s limited capacity and reliability.

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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com