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Flybe enters administration – what happens next?

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Flybe has finally collapsed tonight, after the Government refused additional requests for emergency funding.

The website went down around 10.45pm:

Flybe enters administration

And here is the official notice issued at Glasgow Airport, impounding one of their aircraft for non-payment of fees (click to enlarge):

Flybe enters administration

The last aircraft to land was due to be BE7308 from Hannover to Manchester at around 10.30pm.

If you saw my BBC TV interview on Tuesday, you will know that I mentioned Flybe when asked about airlines which I thought may collapse.  I felt a bit guilty about saying this, since I know many of the senior team there, but it was not exactly the sort of guess which required an industry expert.

The Financial Times had reported earlier that the Government had rejected the original request by the airline for a £100 million loan.  Whilst it was possible that Flybe would have benefited from changes to Air Passenger Duty in the budget next week, this may have been too little too late.  Any changes would have taken time to implement, and there is even talk of the budget being postponed in full as coronavirus is making financial planning difficult for the Government.

By the time you read this we will probably have the full picture.  The airline does not night-stop any aircraft, I believe, so all of the assets should have been back on UK soil late tonight unless any were impounded abroad.

This is not necessarily the end:

Will Virgin Atlantic buy the airline from the administrators?  (Difficult, given that it would have to resume trading at a time when no-one is booking.)

What will happen to the regional airports which are dependent on Flybe to keep operating?  Look at this list (some of these are franchised Flybe flights which will continue):

Anglesey – 100% Flybe 

Southampton – 95% Flybe

Belfast City – 80% Flybe

Exeter – 78% Flybe

Newquay – 66% Flybe

Wick – 59% Flybe

Jersey – 57% Flybe

Cardiff – 52% Flybe

Guernsey – 50% Flybe

Isle of Man – 49% Flybe

Does British Airways get back the ex-bmi Heathrow slots which it was forced to divest to Virgin Little Red and then Flybe?

Who will pick up the two routes which are operated under public subsidy?

Are the Stobart assets ring-fenced from the administration – and if not, what happens to the flights that Stobart runs under contract for Aer Lingus?

And who will fill the Hampton by Hilton Exeter Airport every night, which was only built after Flybe guaranteed to provide most of the guests via people who were at its training academy next door?!

There is, somewhere inside Flybe, a small and profitable regional airline which is not weighed down the financial and physical baggage of a history of failed expansion.

Whether Virgin Atlantic is the one to put this back together remains to be seen, but I would imagine that the profitable routes are not the ones which would provide Virgin with feed.

For the rest of the airline industry, there is no good news here.  The biggest winners from Flybe’s collapse, if the pieces are not picked up, will be the train companies and petrol stations.  In the meantime, the public will become even more paranoid about booking flight tickets.   If Norwegian follows in the next couple of weeks then there really will be a crisis of confidence.

EDIT:  We have now added a new article covering the announcements from Loganair, Eastern and Blue Islands as they pick up ex-Flybe routes.

Comments (195)

  • Chris L says:

    Very sad for employees and worrying for many businesses across the UK who depend on Flybe to travel. Let’s hope it’s not the end.

  • Mark says:

    Wonder which airline will be the next to fall…

  • Pareet Shah says:

    First travel casualty of this outbreak. I fear many more will follow. Thinking of all the staff with uncertain futures.

  • MM says:

    Hi Rob, just to say that Glasgow Airport have been asking everyone they can online (check twitter) to obscure the personal details on that notice that’s being shared – you will prob want to do the same. To their credit they’re not saying take it down, just obscure the personal info and signature of their staff member.

    • Rob says:

      OK, will have a look (given zero pic editing skills!)

    • Nick_C says:

      What a bizarre obsession with secrecy.

      • Nic says:

        Not secrecy but privacy. In a world where people regularly get death threats for innocuous preferences about, say, favorite TV shows on Twitter, having an employee’s name out there in the middle of an unfortunate financial event could target them for all sorts of abuse.

  • Mark says:

    Not good times. But I feel this will be the start of many companies to go bust across many sectors.

    People will be avoiding public places, shops, restaurants, cinemas, etc the list is endless.

    There’s going to be a need for a radical government shake up and approach to business. What they do we will have to wait and see but personally I blame the media hype!

  • AJA says:

    This is sad but we can’t say we didn’t know it might happen and it is a business, it can’t operate indefinitely making a loss. So sorry for all the staff and for all the airports and their staff affected by the shut down.

  • ADS says:

    Surely this is an excellent opportunity for Ryanair to swoop in on the more profitable routes – and possibly on the LHR slots.

    Ryanair have just announced that they are reducing capacity, especially to Italy, so they have spare aircraft to open new routes. And they can be devastatingly quick when they want / need to.

    • Rob says:

      These are, mainly, not routes which require 160-seaters. Ryanair needs 90%+ load factors 365 days a year.

      • ADS says:

        Never underestimate Ryanair’s ability to stimulate demand with their pricing … and then milk the route on busy days !

      • Nick says:

        Ryanair only flies 364 days a year… and has 189 seats per aircraft. Other than that, spot on!

    • C77 says:

      Not to mention a lot of BE routes operated to/from smaller regional airports which aren’t capable of handling the larger Airbus/Boeing aircraft that FR/EZY have making up their fleets.
      Belfast City as an example can’t handle a fully loaded Ryanair 737-800. The aircraft would be limited to a maximum 140 seats in order to take off which falls well below their high passenger load requirement. Southampton again is also extremely limited in what it can handle unless the runway is extended – a reason why EasyJet hasn’t bothered there to a significant degree – a seasonal winter Geneva service is all they offer and this too I would guess is weight restricted due to the short runway. This will have larger repercussions beyond the airline folding.

    • NigelthePensioner says:

      😵

      • Rob says:

        Time to get your ruler out and compare the runway length at Flybe’s core airports with the take off requirements of a 737.

  • Will says:

    Fond memories of flying up to Inverness with them to pick up a Subaru Impreza and driving it back down to bristol in the snow.

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