After months of struggle and speculation over its long term future, Philippine Airlines filed for Chapter 11 bankruptcy in New York. The company will need court approval for its plans to trim liabilities by US $2 billion by restructuring and reducing its fleet by a quarter.

With the company not expecting a return to pre-pandemic levels until 2024 to 2025, the carrier will return 22 aircraft to lessors, Philippine Airlines President Gilbert Santa Maria told a news conference.

Philippine Airlines will end with 70 aircraft after cutting about a quarter of its fleet of 92 planes.

The flag carrier has also negotiated with Airbus for the postponement of the delivery of 13 narrow-body Airbus aircraft, with an option to cancel some orders beyond 2026 to 2030, said Nilo Thaddeus Rodriguez, the company’s chief financial officer.

According to the proposal PAL will receive about US$500 million in equity and debt financing and an extra US$150 million from new investors.

The airline says 90% of its lenders approve the plan.

“The chance that this will fail is very small,” Santa Maria said.

PAL management told Bloomberg the proposal calls for a 35% reduction in the workforce.

The airline has struggled for years with its last posted profit in 2017.