LEVEL Europe, sister airline of British Airways, goes bust, becoming IAG’s first coronavirus casualty

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LEVEL Europe, one of the sister airlines of British Airways, has just filed for insolvency.

This makes it IAG’s first casualty of the coronavirus pandemic.

According to a statement on its website:

LEVEL files for insolvency

LEVEL Europe will enter insolvency on June 18, 2020.

All flights have been grounded as of March 2020 and the Austrian business has ceased trading with immediate effect.

CUSTOMERS

Please note that LEVEL Europe is unfortunately not able to arrange alternative flights for passengers. At this time we kindly request you do not contact our Call Centres unless your travel is within the next 48 hours, as we are experiencing high levels of call volume at this time.

If you have a booking sold by a marketing carrier or travel agent for LEVEL Europe flight, please contact that marketing carrier or travel agent to confirm if there is any impact to your travel plans.

An administrator will be appointed to answer further questions.

EMPLOYEES

In the event that you were an employee of the Company and you require any further information or assistance in relation to the Administration, an administrator will be appointed. Contact information for the administrator will be posted on this page on or before Wednesday June 24, 2020.

CREDITORS AND SUPPLIERS

In the event that you were a supplier or creditor of the Company and you require further details in relation to the Administration, an administrator will be appointed. Contact information for the administrator will be posted on this page on or before Wednesday June 24, 2020.

LEVEL Europe files for insolvency

This isn’t quite as significant as you might think. The LEVEL brand is used by several different operating carriers within IAG, including Iberia, OpenSkies and LEVEL Europe.

LEVEL Europe was the short haul operation based in Vienna and legally owned by Vueling using a license in the name on ANISEC.  It operated a relatively small fleet of six A320 and A321 aircraft out of Vienna and Amsterdam to destinations such as Rome, London, Lisbon and Barcelona.

The airline has been grounded since March.  Around 240 staff are believed to be affected, of which 200 are based in Vienna and 40 in Amsterdam.

The LEVEL long haul airline operation is unaffected, at least for now, since it is operated under separate Air Operating Certificates and is legally part of of Iberia and OpenSkies.

The unwillingness of IAG to support LEVEL Europe is interesting, and shows that the group is willing to make tough decisions about the future size and shape of the wider group.  It may have been partly driven by a proposed new law, drafted as part of the bailout of Austrian Airlines, imposing a minimum air fare of €40 for flights departing from Austria.  Whilst dressed up as an environmental measure, the real impact will be to drive budget carriers out of the market and reduce competition for Austrian.

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Comments

  1. Marc Rensing says:

    Rather than Coronavirus, isn’t it because the Austrian government implemented minimum fare, making Level’s operation not viable

    • Minimum fare rules were just around not being able to sell tickets below the level of airport taxes, which I doubt had as much impact as people think. Added it in as an extra line though.

      • marcw says:

        It needs to go through Parliament first (or whatever they have in Austria).

        • It’s a far-right Government.

          • Marcel says:

            It’s actually not a far-right government but rather a coalition between the Conservative Party (they are a bit populist these days but by no means as much as the Conservatives in the UK) and the Green Party, The minimum fare was introduced so the Green Party is able to sell it as their success.

          • that’s hardly fair with a conservative & green party coalition in government, and the right-wing/nationalist FPO party for once left out.

  2. marcw says:

    Also, Iberia is retiring about a third of their long haul planes. All 14 Airbus 340-600 are going to be retired from service this july-august.

  3. Nick_C says:

    Not assisting customers who have already booked is extremely damaging to the reputation of IAG IMO.

    Makes them look like a dodgy company who goes bust and restarts with a new name the next day.

    Who will they do this to next? Aer Lingus? City Flyer?

    I hope credit card companies will look carefully at whether or not to hand over payments to IAG brands.

    • John T says:

      I doubt many affected passengers will even know what IAG is, let alone let this influence which subsidiary airlines they book with in the future.

  4. My heart is bleeding – cue Air Europa to enter stage left. There is your simplification.
    I’ll even go as far to predict the next phase:
    IB to merge IB Express into their shorthaul programme for a new ‘premium’ brand in European air travel…

    • Air Europa serves a Spanish base whilst LEVEL Europe operated a handful of flights from Amsterdam and Vienna. Not a huge amount of crossover.

      • Although Level as a brand never did achieve much did it. Remembered for their €0.01 flights and little else. Getting rid of the brand doesn’t really impact that much in the greater scheme. It also leaves a space for a new brand at the IAG arena…. Paging Air Europa

        • The LEVEL brand is staying. As I mentioned in the article, it is only LEVEL Europe, which operated short haul flights from Vienna and Amsterdam, that has gone bust. LEVEL continues as a brand in Spain and France.

          • …. for now!

          • Spaghetti Town says:

            If Norwegian were to go under you might see Level magically being merged back into Iberia.

          • I think if the Norwegian government and other investors/creditors were to let Norwegian go bust it would have happened already….

          • Michael C says:

            I’m sending a freelancer collaborator to a conf. BCN-BOS – offered to get her a BA ticket via LHR but she preferred the direct flight on Level…we’ll see!

        • Regardless to what the product offers does now or in the past has nothing to do with future aspirations. I would also wager that the Air Europa brand finds more affinity in name with Austrians than Level ever did.

  5. ChrisBCN says:

    I always did find it odd that IAG had two non-legacy brands for their European ‘low cost’ flights. I always put it down to the fact that no one could pronounce Vueling so Level had to be created…

    Would be easy for them to restart from Vienna and Amsterdam if they choose to in a year or two, using Vueling or Europa. After the Europa buy goes through, maybe they turn Europa into a low cost, replacing Vueling (brand recognition is as good in Spain) with Iberia taking over the more premium parts of Europa.

  6. Remainder2 says:

    I had a LEVEL flight in May which was cancelled from AMS to LTN. Very late in the day cancellation considering that Europe was paralysed by then but it came in the end. A quick call to customer service and the money was back in my account within days with minimal hassle. Very unexpected given the information on the website about coronavirus flexibility was scarce and only really focused on the long haul routes.

    You can’t help but feel sorry for those loosing their jobs though this.

  7. The cynical part of me says it’s WW sending a message to the BA unions

  8. Annih says:

    Greedy billionaires. Trap up your own share base before hitting tax payers.

  9. Interesting story. The mention of OpenSkies in the report. OpenSkies ceased to operate in Sep 2018.

  10. I don’t think Level Europe is owned by IAG/Vueling. It is majority owned by an Austrian company, so technically not an IAG airline.

  11. Can we conclude that IAG was never really interested in VIE or rivalling Austrian then?

    https://onemileatatime.com/etihad-iag-austrian-airlines/#etihad_iag_express_interest_in_austria

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