Ravn Air’s bankruptcy impacts Alaska remote communities

According to simplyflying.com in a message dated 27 May and posted to its official website, Ravn Air announced that the US Bankruptcy Court had approved the airline’s liquidation of assets. The regional Alaskan carrier filed for Chapter 11 protection on 5 April, following a 90% drop in bookings and revenue due to the arrival of COVID-19. But, the company and its services were critical for many remote communities in Alaska.

According to local news reports, Alaskan residents of some remote arctic villages are unable to receive their supplies as a result of Ravn Air’s shutdown. This was the case for Atqasuk resident and tribal-coordinator Millie Frankson, who had a Can$535 order that was supposed to be flown in.

Instead, Frankson had to drive two hours on a makeshift road across the ice to reach the city of Utqiagvik, where her purchase was stored. Commenting on the fact that this is not always possible, Frankson said, “I was lucky enough that the ice road was still open,” adding “[Ravn’s closure] was just a big shock to the whole North Slope Borough. Like, how are we gonna get our food, our mail, our medical needs?”

Ravn Air was only given a few hours notice before it had to shut down its operations on 4 April, with caught many residents unawares. With the airline grounded, more than 115 Alaskan communities have had to make other arrangements in order to receive supplies. 570 News reports that nearly all the communities are accessible only by plane or boat as 82% lack road connections, according to the state’s transportation agency. Furthermore, for about 20 villages, Ravn Air was their sole air service provider.

A message on the airline’s website stated that is a buyer for the operator could be found, then services would resume, but with the filling of a Chapter 11 bankruptcy this is now unlikely.

The latest update on the Ravn Air Group’s wesbite states that it has been conditionally approved by the US Treasury to move forward and seek payroll grants under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) Payroll Support Program. This assistance will help pave the way for buyers who are seeking to purchase the entire Air Group, maximise creditor recoveries, and enable a successful exit from Chapter 11 that will preserve Alaska’s largest and most vital regional air carrier and the many jobs and essential air service it provides.