FLYBE DECLARES BANKRUPTCY
EXETER, ENGLAND – UK airline Flybe has entered administration early Thursday morning, only 1 month after the UK government announced a rescue deal, Business Insider reports. The airline said in a statement that all flights have been grounded and that the business has ceased trading with immediate effect. Flybe was Europe’s largest regional airline, with a fleet of 82 aircraft which served 102 airports. Flybe is the second British airline to collapse within a period of 6 months, after Thomas Cook declared bankruptcy on September 24, 2019.
Flybe has collapsed and has entered administration – a practice similar to declaring bankruptcy – with the loss of more than 2,000 jobs. The airline was already struggling since 2019, but the impact of the corona-virus on flight bookings eventually led to the airline’s bankruptcy.
Airlines around the world are facing new financial problems in recent weeks due to the ongoing corona-virus outbreak.
A UK Department of Transport spokesperson said the move followed a “commercial decision by the company,” adding that the airline’s financial difficulties were the immediate cause of its demise.
Flybe was a low-cost airline based at Exeter International Airport in southwest England, and was the largest independent regional airline in Europe, and provided more than half of domestic flights outside London. Flybe served 102 airports in Europe with a fleet of 82 aircraft.
In addition to Exeter International Airport, Flybe had hubs in Aberdeen, Belfast, Birmingham, Bournemouth, Edinburgh, Essex, Southampton and London. Flybe had concluded code sharing agreements with Finnair, Aer Lingus, British Airways, Etihad Airways, Air France and KLM.
Flybe was founded in 1969 as Intra Airways with its home base in Jersey. In 1979 the airline changed its name to Jersey European Airways and in 2000 to British European Walker Aviation, which took a 81% share in the company. In 2002 the airline introduced its current name – Flybe. BA Connect – a former subsidiary airline of British Airways – was sold to Flybe in 2007.
As of March 2020, the Flybe fleet consisted of 54 De Havilland Dash-8-400s and 9 Embraer 175s. Flybe was phasing out and returning its Embraer 195s to lessors, once retired. Flybe had stated the Q400 was to remain the backbone of its fleet going forward.
Last year, Flybe was in a poor financial position resulting in a take-over by Connect Airways in 2019, a consortium of British aviation company Virgin Atlantic, transport group Stobart Group, and investment company Cyrus Capital. The company continued to maintain regional air connections after the acquisition.
However, the take-over did not solve Flybe’s financial problems. There were rumors on January 13, 2020 that Flybe was in financial trouble again.
On January 14, the UK government announced that it had signed a deal with shareholders to save Flybe. The 75 aircraft at the time and 2000 employees were able to continue.
Unfortunately – despite the state’s aid – Flybe could not solve its financial problems, due to the corona-virus’ impact on flight bookings, which proved to be the last straw for Flybe, as the government stalled on a controversial £100m loan.
As of March 5, 2020, the airline discontinued all services and applied for a moratorium.