UK regional airline Flybe has officially folded after failing to secure the loan from the government.
In January 2020, Flybe arranged a deal with the British government for a £100m loan and deferred payment of more than $130m of Air Passenger Duty (APD) payments. After the agreement, Flybe tweeted: “Flybe remains committed to providing exceptional air connectivity for the UK regions with the full support of its shareholders.” However, there was predictions that the airline would not receive the financial aid, costing 2,000 jobs and significantly effecting the UK’s regional connectivity.
Regional air connectivity will be majorly affected in response to the collapse, described as “disastrous” for the UK, with 88 of the 120 routes flown by the airline not operated by any other carrier. In four of its UK airports, Flybe operated more than 70% of flights: Anglesey, Belfast City, Exeter and Southampton, meaning local economies are expected to be impacted too.
The UK government responded to the news by stating that it was willing to help workers find new jobs: “We are working closely with industry to minimise any disruption to routes operated by Flybe, including by looking urgently at how routes not already covered by other airlines can be re-established by the industry.”
In response to the collapse, European airline Ryanair has launched flights to help those that may have been disturbed. Routes will include Liverpool-Knock, Bournemouth-Dublin, Belfast-London Stansted, Bristol-Dublin and Belfast-Manchester. Alejandra Ruiz, the airline’s Sales & Marketing Manager said, “We are working closely with the CAA to accommodate passengers who may have been left stranded or have had their travel plans disrupted by the collapse of the airline.”
Over recent years, Flybe suffered from the accumulation of high fuel costs, currency fluctuations and Brexit uncertainty. In 2019, the airline was bought by a consortium that includes Virgin Atlantic, said to provide £30m to the business. Beside this, it was hoped that the “£100m lifeline” and a push for change to the APD tax could aid the airline. Whilst most competitors currently pay £13 per passenger in APD, Flybe hoped that figure would be halved. However, due to negative responses from other companies within the aviation industry, any alterations were not permitted which left Flybe struggling still.
More recently, the outbreak of the coronavirus added to the airline’s impending downfall as it “made a bad situation much worse.” The epidemic caused a decrease in the demand for air travel and seems to be preventing other airlines wanting to take over the routes lost along with Flybe.
Mark Anderson, Flybe’s Chief Executive commented, “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 began attempts to re-establish itself in the industry over the last 10 years, aiming to adapt its fleet and fly the comparably larger Embraer ERJ-170 and ERJ-190 within its network. This did not work, which left them paying for four aircraft that they could not use.
Flights have been cancelled, aircraft seized, and the website vanquished. Anderson added, “The UK has lost one of its greatest regional assets. Flybe has been a key part of the UK aviation industry for four decades, connecting regional communities, people and businesses across the entire nation.”