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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)

  • Jjack says:

    At least Alitalia is safe 🙂 not sure about Norwegian though.

    • Jonathan says:

      How long for Alitalia though?

      I thought I read somewhere that the Italian government is not going to give them anymore help, and this was a news article that was written before Coronavirus became a worldwide public health scare.

      Norwegian, it’s hard to know how many people want to ultra cheap long haul plane travel, ultimately, if you go for a more premium service, you get all kinds of things included in the cost of the ticket, and things you really do want with cheaper airlines are just optional add-ons at generally inflated prices

  • Youngtraveller says:

    Flew Flybe a few times to Paris from Cardiff. Sad to see it go, the staff were always friendly and some even remembered me as I became a regular. I remember how they always joked with kids who clearly just came back from Disneyland or were going there. Will miss them hope the staff manage to recover.

  • BP says:

    The wife is flying Stobart tomorrow. Be keen to understand if Stobart included in this.

    • ChrisC says:

      Stobart is a totally separate company.

      Whilst it owns 30% of FlyBe it kept its existing flight operations and didn’t wrap them into Flybe and that was, as far as I recall, their position right from the start.

      Any flights it operated under contract to Flybe will cease unless stobart wants to keep operating those flights themselves

  • Nick says:

    “the public will become even more paranoid about booking flight tickets”

    BA has pulled the Paris-US fare because too many people were booking. Doesn’t look to me that people are paranoid about travelling!

    Will be interesting to see what happens though. If it’s not total disaster by May then people will start booking holidays – either it’ll stimulate staycation demand (satisfying those who wanted Brexit!) or push lots of bookings to any airline with enough cash to last until then. If it’s total disaster then all bets are off. But then we’ve got bigger problems.

    Flybe’s demise will have Extinction Rebellion dancing in the aisles… ironically not thanks to anything they’ve done!

    • Bazza says:

      Staycation and brexit??? I think you are very confused man.

      • Alex W says:

        Yes how are the gammon going to get to Costa del Sol and Magaluf now?

        • Iain Miller says:

          There’s the kind of bigoted snobbery which helped push through brexit!
          Cheers!

    • J99 says:

      “Doesn’t look to me that people are paranoid about travelling”

      Declining passenger numbers, rather than one instance of high demand, suggest otherwise

      • Rob says:

        General view is that bookings are down 50%. I am guessing this is by volume, it will be a lot more by value without fully flex business tickets at BA etc.

    • Doug M says:

      Fares like the Paris-USA come and go all the time. They seldom run until the date they say as supply in the fare buckets necessary is exhausted.

  • Martin says:

    The final arrival appears to have been just before midnight in ABZ – Olympic swimmer Hannah Miley was tweeting from onboard. It seems to have been briefly impounded in MAN before being allowed to fly:
    https://twitter.com/HannahMiley89/status/1235356182455468035

    The penultimate landing at BHD seems to have gone through the same:
    https://twitter.com/HollyHNews/status/1235301789207015425

  • Alan Wan says:

    I booked a flight BHX-GLA, it was a Flybe operated flight with VS flight numbers and booked via Amex travel paying with an Amex Gold card.

    What is the best way to get my money back?

    • The Original David says:

      Chargeback on your Amex PRG. They normally refund the charge in a matter of minutes.

  • Mikeact says:

    With their deep….very deep pockets, I fail to understand why Branson and Delta didn’t dig deep to keep it going. After all, they aquired it for their own interests ultimately…..nobody asked them to.
    Together with all the rubbish hype they all spouted, it was pretty obvious that it was never going to last…….extremely annoying and upsetting all round.

    • Tyna says:

      Perhaps the real purpose for purchasing FlyBe was asset stripping?

      • Mikeact says:

        Without wishing to take up too much space……a reminder. What a lot of wishful thinking.

        The airline had planned to rebrand as Virgin Connect later this year, following investment by a consortium including Virgin Atlantic. Mark Anderson, CEO of the consortium, Connect Airways said at the time, “Virgin Connect will be passionately focused on becoming Europe’s most loved and successful regional airline. It will offer travel that is simple and convenient with the personal touch. Our customers will naturally expect the same exceptional travel experience as they do with other Virgin-related brands. As part of the Virgin family, we now have a tremendously re-energised team”. Flybe quickly burnt through the consortium’s investment and had even sought a further £30 million investment from the consortium as part of a wider January 2020 government rescue package though this rescue did not proceed as Flybe did not meet certain government criteria.

    • The Jetset Boyz says:

      Virgin Atlantic apparently advised Flybe on Tuesday evening that it was unable to provide further support to the airline due to the impact of Coronavirus on its own bookings. Also, Flybe had just £5.7m of cash reserves but owed creditors more than £10m by today.

      It’s come to light that HMRC sought to wind-up the airline in January due to unpaid APD of £5.8m and a tax penalty of £844k.

  • Curious Traveler says:

    I have €350 of Norwegian airmiles credit – will I lose this completely if the airlines goes bust? Am I protected if I book a flexible ticket in the future using this credit and pay the remainder with my credit card?

    Don’t want to risk losing this 🙁

    • Rob says:

      You are losing it.

      • Shoestring says:

        CT has a point, though – if he booked the flight he mentions with at least £1 on a credit card, he’d be covered by S75, in the sense that if N goes bust, they’d have to pay for an alternative flight

        if it were myself, I’d go above £100 on the credit card so that they wouldn’t even think of wriggling out of their liability (though that’s not strictly necessary)

        but is there actually a flight you want to take?, as credit card co would not alternatively refund you for your points if N goes bust (or for the normal list price of the flight – your points are counted as zero cost)

      • Jamie says:

        How likely are they to go under?

        • Rob says:

          Who knows? IAG/BA has €4 billion cash in the bank. Norwegian had £250m at the end of 2019 but will be burning it quickly.

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