Richard Branson's Virgin Atlantic has filed for bankruptcy US as the airline industry continues to get decimated by the pandemic.

This comes after the company's cash reserves reached "critical levels", only able to sustain for another month.

Chapter 15 of the US bankruptcy code allows a foreign debtor to shield assets of Virgin Atlantic in the US in order to finalize a US$1.5 billion restructuring plan to save the company.

According to a spokeswoman for Virgin Atlantic, the process is supported by a majority of the airline's creditors and obtained approval to convene meetings of affected creditors to vote on the plan on August 25.

Virgin Atlantic also told a London court it could run of money in September if a restructuring deal is not approved according to reports.

Global air travel isn't expected to fully recover from the pandemic until 2024, according to the International Air Transport Association, which represents 290 airlines.