Coronavirus Speeds Up Flybe Collapse
Flybe collapsed last Thursday. All flights on the Exeter-based airline were cancelled, affecting thousands of passengers and more than 2,300 employees. The official announcement came at 3 am, but it had already been clear on Wednesday that the airline was going out of business. Flybe passengers with bookings for flights on Thursday were sent a text at 2 am:
"All Flybe and Stobart Air operated flights have been cancelled with immediate effect. Please do not travel to the airport as your flight will not be operating.
If you are booked to travel on a Blue Islands or Eastern Airways operated flight, these are expected to still operate.”
For 40 years, Flybe flights have played a key role in connecting people, businesses and communities across the UK.
The collapse of Flybe, which was Europe’s largest independent regional airline, comes after significant funding challenges. As the chief executive Mark Anderson explained, the outbreak of coronavirus has further aggravated the situation.
The government has asked bus and train operators to accept Flybe tickets and other airlines to offer reduced fares to aid passengers and airline staff in making their journeys as smooth as possible. British Airways, Ryanair and easyJet are offering discounted tickets on certain routes (“rescue fares”).
Transport secretary Grant Shapps assured Flybe employees they’ll receive help in finding new jobs.
The airline was bought a year ago by the consortium of Virgin Atlantic, Stobart Group and the US hedge fund Cyrus Capital. The owners invested £100m but Flybe was rapidly going down and the money soon ran out. The consortium asked for state aid. Then the continued spread of coronavirus hit the global airline industry as people stopped travelling.
However, the impact of the coronavirus is not the sole reason for the airline collapse. Flybe’s business plan has been derided by competitors.
Some of them are now expected to set up replacement domestic flights, especially to and from Belfast. Scottish airline Loganair has said it will take over 16 of Flybe’s key routes and launch almost 400 new weekly flights from the UK.
Many blame the owners and the government for not acting on the promised rescue deal and allowing Flybe to go into administration.
Flybe’s collapse is the fourth notable one of a UK airline in less than 4 years. Monarch went out of business in 2017, and Flybmi and Thomas Cook Airlines in 2019.
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Know Your Rights As a Passenger
How will Flybe’s collapse affect you as a passenger? Let's see:
Will you lose your flight booking?
Yes. All Flybe planes are grounded and services are cancelled.
You need to book another flight or find an alternative way to reach your destination.
In recent years, after the collapse of Monarch and Thomas Cook, the Civil Aviation Authority helped people get home, even though it wasn’t strictly obliged.
Will the cost of your cancelled flight be refunded?
Receiving a refund from the airline is questionable and highly unlikely.
Most Flybe passengers bought their flight tickets separately from a vacation package If that is your case you’ll most probably have to rely on a refund from your credit or debit card provider. The other option is to claim from your travel insurance.
Could your travel insurance cover the cost of flights and accommodation?
That depends on the type of travel insurance policy that you’ve bought.
- 49% of travel insurance policies have airline failure cover included as standard.
- 19% have it as an optional add-on.
- 32% have no such cover.
The benefit of having one is that the insurer should be able to reimburse the cost of a replacement flight with another airline - something that would be more expensive after the collapse of a carrier.
Can you claim a refund from your card provider?
If you have paid more than £100 on flights directly with the firm on a credit card, you should be able to claim a refund for the flight from your card provider. This is known as Section 75 protection, part of the Consumer Credit Act.
If you have paid less or used a debit card, you can try claiming from the card provider under the chargeback system. However, this is not a legal right and not always successful.
Why is the current situation different from that of Thomas Cook?
After the collapse of Thomas Cook, many of their clients who had bought full package holidays were covered by the Atol scheme.
If you pay for a flight and a hotel separately, you might lose the money paid for both. Explain the situation to the accommodation provider and check if they are flexible. They might give you a refund or different dates for a stay if necessary.