Passengers stranded as airline collapses

The company went bust earlier today after crisis talks to secure a £100 million ($A194 million) loan from the government came to a halt.

The regional carrier narrowly avoided going bust in January but has continued to lose money amid the coronavirus outbreak.

A drop in demand caused by the coronavirus “made a difficult situation worse” for the budget airline.

Mark Anderson, the CEO of Flybe, last night told of his “enormous sadness” in a letter to staff in which he said Ernst & Young are expected to be appointed as administrators for the company.

“It’s with enormous sadness and a deep feeling of sorrow that I share the upsetting news that FlyBe is shortly being put into administration,” he wrote.

“Despite every effort, we now have no alternative — having failed to find a feasible solution to allow us to keep trading.

“Although I have only had the honour of being your CEO for eight months, its been an incredible privilege to lead such an amazing team of people and the FlyBe family.”

On Wednesday evening local time, passengers reported being turned away from boarding as staff informed them there would be no more flights.

Also in meltdown is the airline’s website — as an error message appears upon loading stating the link is “no longer live”.

It means that more than 2000 jobs and the future of a number of regional airports will be at risk.

Peter Smith, an ITV television journalist, tweeted: “Has Flybe just ceased operating in front of my eyes?

“Waiting to board a Flybe flight to Birmingham and all of their flights have just been cancelled. Advice from staff is Flybe ‘definitely will not be flying out tomorrow either’.”

Flybe, however, have blamed the disruption to flights at Glasgow Airport on “miscommunication” over refuelling of two services to Birmingham.

A spokeswoman said: “Flybe can confirm that, following a miscommunication regarding refuelling this evening, two flights were delayed and that due to the crew now being out of hours, have been cancelled.

“We sincerely apologise to those passengers inconvenienced by the disruption to their travel plans.”

Despite this, a source from the airline told Sun Online that the operator will go bust later this evening after its final airborne flights touch down at airports across the UK.

It is understood that the Flybe staff on night shift at Exeter Airport have been sent home.

BBC journalist Holly Hamilton, whose flight from Manchester was aborted shortly before takeoff, said crew members were in tears as news about the company’s flight filtered through.

She wrote on Twitter: “Staff in tears. This is so grim. Plane is just really quiet.”

The Financial Times says the government is refusing to dish out a £100 million state loan as the budget carrier hasn’t met certain criteria set by the government.

Flybe, which has been hit by a slump in bookings due to the virus outbreak, was saved from going bust by the government earlier this year.

The airline is now supposedly clinging to the hope of an air passenger duty (APD) cut in next week’s Budget in order to survive.

The Department for Transport told The Sun it wouldn’t comment on speculation.

Flybe also declined to comment but did confirm it’s yet to receive funding from the government, although it says talks are ongoing.

The airline added that it’s been hit by coronavirus with a lack of demand for flights and passengers cancelling bookings.

It’s reportedly said it needs a decision on its request for a taxpayer loan “in the coming days”.

Back in January, it was thought a £100 million bailout had been agreed between the government and Flybe to save the beleaguered airline from collapse.

Former business secretary, Andrea Leadsom, tweeted at the time: “Delighted that we have reached agreement with Flybe’s shareholders to keep the company operating, ensuring that UK regions remain connected.

“This will be welcome news for Flybe’s staff, customers and creditors and we will continue the hard work to ensure a sustainable future.”

But just a day later the government backtracked saying no such loan was confirmed after British Airways owner International Airlines Group (IAG) complained to the EU over the “unfair” rescue deal.

IAG said such a loan would give the struggling airline an unfair advantage.

Ms Leadsom was then axed from her role as secretary of state for Business, Energy and Industrial Strategy in February as part of a cabinet reshuffle by Prime Minister Boris Johnson.

Transport secretary Grant Shapps had also welcomed the supposed agreement. He retained his position in the reshuffle.

A second plan was thought to involve Flybe deferring its APD for three years in a deal estimated to be worth £106 million, but the details have not been made public.

Shareholders had also agreed to inject extra capital into the airline business in the meantime.

Flybe employs 2400 staff but says it’s business as usual for staff and passengers alike for now.

If the carrier falls into administration it will become the second UK airline to fail in just six months, after Thomas Cook went bust in September.

HISTORY OF FLYBE AIRLINES

FLYBE began as Jersey European Airways in 1979, operating regional flights from Jersey in the Channel Islands. Its route network grew and it was rebranded British European in 2000, before becoming Flybe in 2002.

Flybe is now Europe’s largest regional carrier, flying around 9 million passengers a year to 170 destinations across the continent. Virgin Atlantic, Stobart Group and Cyrus Capital bought Flybe in February 2019 for just £2.2 million following poor financial results.

The group, known as Connect Airways, pledged to inject cash into the airline to turn it around

This article originally appeared on The Sun and has been republished with permission