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Coronavirus pushes Flybe into administration

Coronavirus pushes Flybe into administration

Regional airline Flybe has gone into administration.

Falling demand for air travel in the wake of the coronavirus outbreak was partially to blame, the carrier said in a statement.

Some 2,000 jobs are now thought to be at risk.

The airline’s website advises customers to “not travel to the airport” unless they have arranged an alternative flight.

“Please note that Flybe is unfortunately not able to arrange alternative flights for passengers,” a statement added.

Flybe came close to administration in January, with the government controversially agreeing to defer up to £10 million in air passenger duties to aid its survival.

A bid for fresh financial support failed last night.

In a letter to staff, Flybe chief executive Mark Anderson said: “Despite every effort, we now have no alternative - having failed to find a feasible solution to allow us to keep trading.


“I am very sorry that we have not been able to secure the funding needed to continue to deliver our turnaround.”

Flybe was acquired by a consortium led by Virgin Atlantic and Stobart Group in January last year, with plans to rename it Connect Airways in the coming months.

A Virgin Atlantic spokesperson explained: “With customers and staff at the front of our minds, over the past 14 months the consortium has invested more than £135 million to keep the airline flying for an extra year, maintaining 2,400 people in employment and ensuring customers could keep travelling.

“This amount includes approximately £25 million of the £30 million committed in January, alongside a Time to Pay arrangement with HM Treasury for air passenger duty to the value of £3.8 million.”

The spokesperson added: “Sadly, despite the efforts of all involved to turn the airline around, not least the people of Flybe, the impact of COVID-19 on Flybe’s trading means that the consortium can no longer commit to continued financial support.”

Flybe was the largest regional airline in Europe and flew more UK domestic flights than any other airline, some 38 per cent of all UK domestic flights last year.

The carrier operated 139 routes and served eight countries from 56 departure points in the UK and Europe.

Flybe was the largest scheduled airline by air traffic movements at Aberdeen, Belfast City, Birmingham, Cardiff, Exeter, Isle of Man, Manchester, Newquay and Southampton airports.

This regional connectivity will now be lost, posing problems for travellers.

The carrier had operated a fleet of 68 aircraft, largely Bombardier Q400s.


Analysis from GlobalData, however, questioned how important the coronavirus was to the collapse of the airline.

Ralph Hollister, travel analyst for the analytics company, said the writing had been on the wall for the Flybe since its profit warning in 2017.

“Flybe blamed a number of external factors for its prolonged demise such as maintenance costs, the weaker pound and rising fuel costs.

“However, its competitors had to deal with these issues too. The main difference is that Ryanair and British Airways possess focused business models.

“Flybe was caught between the two, offering short-haul flights for prices that were not necessarily low cost,” he argued.

“The impact of coronavirus may have also provided the perfect opportunity for a Virgin Atlantic led consortium to stop injecting money into a business that seemed to be some way away from achieving profitability.”

“Attempts by major European carriers to dominate the market have led to an ongoing price war, which has resulted in a growing list of airline casualties.

“One of the first was UK airline Monarch, which went into administration in 2017.

“This incident should have set alarm bells ringing for Flybe.

“Unprofitable routes should have been scaled back much sooner than they were.

“Coronavirus could determine the fate of other struggling airlines on a global scale as world-wide demand for travel plummets.

“Larger airlines are also not immune from the impacts of the virus.

“Virgin itself announced emergency measures, including cutting executive pay, and urging other staff to take unpaid leave.”