Latam Airlines files for Chapter 11 bankruptcy protection

South American carrier Latam Airlines says it is seeking Chapter 11 bankruptcy protection as it grapples with the sharp downturn in air travel sparked by the coronavirus pandemic.

The Santiago, Chile-based airline said Tuesday that it and some of its affiliated companies launched the reorganization effort in the United States.

The carrier aims to continue operating and hopes to reduce its debt and find new financing sources through the bankruptcy process.

Passenger and cargo flights will continue to operate, and employees will still be paid, it said.

Latam said the bankruptcy filing has the support of two families that have big stakes in the company, as well as large shareholder Qatar Airways.

The bankruptcy filing includes parent company Latam Airlines Group S.A. and its affiliated airlines in Colombia, Peru and Ecuador, as well as its businesses in the U.S.

Latam is not including its affiliates in Argentina, Brazil and Paraguay. It says it is talking with the Brazilian government about how to proceed with its operations there.