The airline said it will restructure with the help of American and United.
An Azul E190 (Photo: Shutterstock | Joao Fachetti)
Azul Brazilian Airlines is filing for Chapter 11 bankruptcy as it looks to restructure and reduce billions of dollars of debt.
In a statement, the São Paulo-based airline said it has reached an agreement with stakeholders and partners, specifically American, United, and aircraft leasing company AerCap, to “effectuate a proactive reorganization process,” which will include reducing its lease obligations and optimizing its fleet.
As part of the deal, Azul will get an infusion of $1.6 billion in financing, with the long-term goal of erasing over $2 billion in debt. Also included is a provision for another $950 million in equity financing once the Chapter 11 process is complete.
The carrier will continue operations as it navigates the bankruptcy process, Azul officials said.
“Azul continues to fly – today, tomorrow, and into the future,” said CEO John Rodgerson. “These agreements mark a significant step forward in the transformation of our business – one that enables us to emerge as an industry leader in the main aspects of our business.”
Azul took on substantial debt during and following the height of the COVID-19 pandemic, as demand for air travel slumped. Its debt burden surged by 50% in the first quarter of 2025 compared to the same period one year prior.
United, which already has a strategic partnership with Azul, and American, which did not, are providing part of the financing meant to rescue the airline.
United has a codeshare agreement with Azul that allows passengers to earn United points when flying. It also invested $100 million in the airline 10 years ago, which secured a seat on Azul’s board of directors.
“Azul is more than just a commercial partner for United – their customer-first approach and unique route network connecting small and large communities have improved the passenger experience in Brazil,” said Andrew Nocella, United’s executive vice president and chief commercial officer. “That’s why we support Azul’s restructuring process and have entered into an agreement to build an even stronger relationship in the future.”
An Azul Airbus A320neo aircraft (Photo: Airbus)
American has a preexisting relationship with an Azul rival, Rio de Janeiro-based GOL. American allows GOL passengers to earn American rewards points, and in 2022, it bought a 5% stake in the airline.
In a statement, American Vice Chairman and Chief Strategy Officer Stephen Johnson said the deal with Azul will complement its current alliances and increase connections throughout South America.
“Our service, including that of our partners GOL and JetSMART, combined with the strength and breadth of Azul’s network, will provide our customers another unique option for traveling between the Americas and even more connectivity in Brazil and throughout South America,” he said. “We are excited to support this process and to be part of Azul’s future.”
A number of Central and South American airlines were forced into bankruptcy during the pandemic, including GOL, Aeroméxico, Colombia’s Avianca, and LATAM Airlines. Aeroméxico, Avianca, and LATAM Airlines have all since emerged from bankruptcy proceedings, while GOL is expected to end restructuring in June.
Azul began operations in 2008, spearheaded by serial airline founder David Neeleman. He also founded other airlines, including JetBlue and Breeze.
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