The Mexican governmentwill revoke the concession of budget airline Lineas Aereas Azteca after it failed to fix safety problems that led to its grounding six months ago.
The airline was ordered to stop flying in March after inspectors found it was not complying with safety procedures and obligatory training for pilots, technicians and maintenance personnel.
The airline was given 90 days plus an additional grace period to fix the problems but failed to do so, the Communications and Transportation Department said in a news release.
Azteca finances are also in "grave" condition, with the airline lacking cash flow to cover its debts, the department said.
As a result, the government has "determined to maintain Lineas Aereas Azteca's total suspension and at the same time begin procedures that will lead to its concession being revoked," the department said.
The airline's listed phone numbers were not in service Thursday and company spokesmen could not be immediately reached for comment.
Azteca is a privately owned company founded in 2001, which flew more than 113,000 passengers, or 2.3 percent of the country's total, in the first two months of this year. Officials said the airline has a fleet of nine planes, but only four of those were operating at the time of its grounding in March.
The airline is the second-low cost carrier to be grounded by the government in the past 18 months. Aerocalifornia was suspended in April 2006 for safety reasons but the airline resumed some operations four months later.