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Air Australia collapse leaves thousands stranded

Air Australia collapse leaves thousands stranded

As many as five thousand passengers have been left stranded following a decision to put low-cost carrier Air Australia into administration overnight.

All aircraft operated by the airline have been grounded indefinitely.

John Park and Mark Korda of KordaMentha have been appointed as voluntary administrators.

In a statement, the airline said “no funds” were available to meet operational expenses so flights will be suspended immediately.

“For clarity, it also appears highly unlikely there will be any flights in the short to medium term,” the carrier added.

Administrators confirmed those who had paid for credit card were likely to get a refund, while urging others to consult their travel insurers.

However, those who paid with cash are unlikely to be so lucky.

“Unfortunately if you paid by cash, it is likely you will not be entitled to a refund unless you took out insurance and that insurance covers an event of insolvency,” the administrators said in a statement earlier.

As many as 300 employees have also been left in limbo overnight.

Air Australia is a new passenger airline of charter firm Strategic.

It was re-launched three months ago as a discount holiday airline, flying to Hawaii, Phuket and Bali from its home base in Brisbane.

Air Australia operated two twin-aisle Airbus A330s and two smaller Airbus A320s.