Europe’s largest regional airline, Flybe, has collapsed, threatening thousands of jobs and the future viability of airports across Britain.
Flybe’s demise, which was announced on Thursday (local time) and blamed in part on a drop in demand caused by the coronavirus outbreak, sparked fierce condemnation from unions and opposition politicians, who criticised the airline’s owners and the government for failing to act to save it.
“Do not travel to the airport,” the airline told would-be passengers in a statement acknowledging its collapse.
“All flights have been grounded and the UK business has ceased trading with immediate effect.”
British Transport Secretary Grant Shapps said everyone was “gutted” about the news.
“We really tried to do everything we could back at the turn of the year,” he said.
“Unfortunately, with the situation that has developed with [coronavirus], an already weak company, I’m afraid, just hasn’t been able to survive.”
The coronavirus epidemic is hitting airlines around the world as many people put off travel, and governments impose bans on arrivals from the worst-affected countries.
Flybe narrowly avoided going bust in January but has continued to lose money since then.
The Exeter-based airline announced early on Thursday it had ceased trading and administrators had been appointed. Crisis talks on Wednesday failed to secure a rescue package.
All Flybe flights and those operated by sister airline Stobart Air were cancelled, leaving thousands of passengers stranded.
Some other airlines and Britain’s rail operators stepped in to offer help to stranded passengers and staff.
Flybe was bought by a consortium of Virgin Atlantic, Stobart Group and Cyrus Capital in February 2019 after running into earlier financial problems.
In a statement, chief executive Mark Anderson said the company had made “every possible attempt” to avoid collapse but had been “unable to overcome significant funding challenges”.
“The UK has lost one of its greatest regional assets,” he said.
“Flybe has been a key part of the UK aviation industry for four decades, connecting regional communities, people and businesses across the entire nation.”
Unions and politicians reacted angrily to the collapse of the company, which had a staff of about 2000 – just weeks after it narrowly avoided going under.
In January, Flybe agreed a deal to defer tax payments of “less than £10 million” ($A19.5 million), while ministers pledged to review air passenger charges.
But other airlines, including Ryanair and British Airways owner International Airlines Group, complained the agreement breached EU competition law and state aid rules.
Flybe is the second British airline to fail in six months to fail after Thomas Cook went bust in September.