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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)

  • Oliv says:

    The Coronavirus certainly contributed to the collapse, but I think their new pricing policy (no more cheap tickets) is equally to blame. This contributed to the cash strain

    • Rob says:

      Cheap tickets lost them money. You had base fares pre APD of a couple of quid. If the flight was delayed or cancelled they were on the hook for 100x in EU261. They had become a liability.

      • Oliv says:

        In the long term I agree. But in the initial months of putting in place the new pricing, they miss the cash on the forward bookings. Last year at this time of the year, I had 3 bookings with Flybe (24 flights for my family of 4). This year I have none.

      • marcw says:

        C’mon Rob. EC261 exists since 2004…

        FlyBe problem is BAD management. BAD BAD BAD management.

        • Rob says:

          That wasn’t the question. The question is why Flybe stopped selling dirt cheap tickets. And, as Mark Anderson told me in person, the reason is that they realised the EC261 costs – given their reliability issues – were far higher than the money ex taxes they were bringing in.

          Obviously if they had fewer reliability issues it would have been less on an issue, but that is a separate point.

          • marcw says:

            In that case you should fix the problem – AKA reliability.

          • Lady London says:

            “coronavirus” excuse has taken over from “Brexit” excuse.

            “Brexit” excuse was helping out with the “security” excuse.

            “security” excuse was the best thing since the “Health & Safety” racket.

          • Alex Sm says:

            They didn’t stop
            I booked Guernsey to SEN flight for 11 pounds (return leg, 50 outward) like 3 weeks ago

  • John says:

    Never really liked flying with them, but hope the staff get sorted/treated well:

  • Eli gold says:

    Thanks to Corona virus Brexit has been let off the hook.
    Till not long ago Brexit was the default excuse for any poorly managed company folding

  • Doug M says:

    Given Virgin only acquired 30% they either already had money issues, or were never that committed to it anyway.

  • Guy G says:

    OT & @ Rob

    Just received an email from Virgin regarding removal of FX fees on their credit cards in the EEA. Was there a mention or article anywhere?


    • Rob says:

      No, because I am not convinced it is permanent. Tellingly Virgin has not changed their marketing material. This is an EU ruling, but other card companies have dealt with it by renaming their fee.

      • Yorkieflyer says:

        I disagree having see the email from VS money which trumpets it as good news so can’t see it being removed imminently

        • Rob says:

          When it is on the application website, we’ll push it.

          Remember that VS pay us for selling cards, so if this is permanent I’m happy to shout about it.

  • Chris L says:

    For anyone stuck today, First Group are offering free travel to anyone with a Flybe booking for today:

  • Frank says:

    I have a flybe marketed ticket but Air france operated flights…BHX-CDG wondered if AF will still honour the ticket? thanks

    • David D says:

      As it is Flybe marketed, the chances of your booking going ahead is minimal. You should speak to the cars provider you made your booking with to receive a Section 75 refund if a debit card or a charge back if a credit card. If you have insurance with scheduled airline failure in the policy you can contact them as well.

      • Lady London says:

        Other way round @David
        s75 << credit and min £100 (best option as it comes from law)
        chargeback depends if your financial institution offers it (comes from a practice in finance industry. Most seem to but a few exceptions.

    • Bob says:

      1. On my BHX-CDG flight operated by flybe in 2015, there were a lot of AF 057 ticket stock customers, getting a free drink from the BOB.
      AF may be aware of the flybe case from sometimes now and then maybe withold some money it have to give to flybe, and recoup it with what flybe has to paid to AF.

      2. AF is friend with flybe since the 90’s when it was jersey european.

      So maybe you’ll have some luck and your flybe ticket will be honored by AF.

  • Jamie says:

    Got norwegian flights mid-April booked with Amex. Amex would pay for new flights if they go under right?

    Rob, how likely is it Norwegian go under?

    • insider says:

      well they’ve been about to go under for many years now…but i reckon this might be the final nail in the coffin

      • Lady London says:

        It would be a great shame. Can you imagine what airlines that have had to offer decent prices because Norwegian is there, will do in future once things settle down, if Norweg disappears? This is not a good thing and I include our own dear BA and SK who will take full advantage.

        • Colin MacKinnon says:

          BA flights in CW from London to Denver were never really impacted by Norwegian from LGW to DEN.

          Maybe in economy, but who flies that!

    • Alex Sm says:

      +1 to the question

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