Delta Air Lines Inc.’s share price down, reduces flights to Venezuela due to currency issues with Venezuelan government

Delta Air Lines Inc. decided to reduce the number of flights between the U.S. and Venezuela due to some difficulties related to repatriating revenue. The company made an official statement, revealing that it intends to reduce 85% of its flights to Venezuela starting August 1st.

One of the spokeswomen of Delta Air Lines Inc. – Ms. Sarah Lora explained that the carrier has decided to cut its flights between Atlanta and Caracas from once daily to once weekly. The decision is to take effect on August 1st. This move of Delta Air Lines Inc. makes the company part of a larger cutback by foreign airlines, which claim that the government of Venezuela owes them more than 4 billion dollars.

The company said in its statement, which was cited by Reuters: “Effective August 1st, 2014, Delta Air Lines will reduce its daily service between Atlanta and Caracas to a weekly service, operating from Atlanta to Caracas on Saturdays and returning from Caracas to Atlanta on Sundays.” As reported by Bloomberg, Delta Air Lines spokeswoman Ms. Sarah Lora also added: “Delta will remain in the market to serve valued customers, however, the debt created over the past several years due to currency issues made us take a business decision to minimize our risk.”

After the flights reduction takes effect, the carrier is to join American Airlines Group Inc., Air Canada Cl B, Alitalia SpA and a few other companies that have fully interrupted or sharply cut the number of flights they carry out to Venezuela over the last few months. Such a step is considered able to put Venezuela into isolation.

The flights between the U.S. and Venezuela were reduced by American Airlines Group Inc. from 48 to 10, with Miami now the only direct destination on the territory of the U.S.

Delta Air Lines Inc. was 4.40% down to close at 36.90 dollars per share yesterday, marking a one-year change of +94.21%. According to the information published on CNN Money, the 17 analysts offering 12-month price forecasts for Delta Air Lines Inc. have a median target of 48.00, with a high estimate of 58.00 and a low estimate of 41.00. The median estimate represents a +30.08% increase from the last price of 36.90.