UK regional airline Flybe ceases trading, cancels all flights

© Reuters. A Flybe plane takes off from Manchester Airport in Manchester, Britain January 20, 2020. REUTERS/Phil Noble/Files

By Mrinmay Dey and James Davey

LONDON (Reuters) -British regional airline Flybe on Saturday ceased trading for the second time in three years, with all flights cancelled and 276 workers made redundant.

A statement on Flybe's website said the airline, which operated scheduled services from Belfast, Birmingham and Heathrow across the UK and to Amsterdam and Geneva, had entered administration, a form of protection from creditors.

"Flybe has now ceased trading and all flights from and to the UK operated by Flybe have been cancelled and will not be rescheduled," it said.

It advised people due to fly not to travel to airports.

A spokesperson for administrators Interpath Advisory said about 75,000 Flybe customers had future bookings that would now not be honoured.

Headquartered in Birmingham, Flybe operated flights on 21 routes to 17 destinations across the UK and Europe using a fleet of eight leased Q400 turboprop aircraft.

David Pike and Mike Pink from Interpath were appointed joint administrators to Flybe.

Pike said Flybe had struggled to withstand a number of shocks since its relaunch last year, not least the late delivery of 17 aircraft from lessors which severely compromised its efforts to build back capacity and remain competitive.

He said scaled-back elements of Flybe's operating platform would be preserved for a short period while there was a possibility of a rescue transaction. He encouraged any interested party to make contact urgently.

A spokesperson for Interpath said 45 members of Flybe's 321-strong workforce had been retained for the time being.

The UK Civil Aviation Authority (CAA) said it would provide advice and information to affected passengers.

"It is always sad to see an airline enter administration and we know that Flybe's decision to stop trading will be distressing for all its employees and customers," said Paul Smith, the CAA's consumer director.

Hurt by Britain's COVID-19 pandemic lockdown, Flybe first fell into administration in March 2020, impacting 2,400 jobs.

In October 2020, it was sold to Thyme Opco Ltd, a firm controlled by Cyrus Capital, and in April 2022 it resumed flights, albeit on a smaller scale.

Flybe's demise contrasts with a post-pandemic pick-up in demand for air travel.

Low cost airlines Ryanair (LON:RYA), Europe's biggest airline, and Britain's easyJet (LON:EZJ) have reported record bookings for summer holidays, in a sign that consumers are still keen on trips despite a looming recession.

Louise Haigh, the opposition Labour Party's transport spokesperson, said Flybe's collapse was "devastating news" for staff and customers.

"Protection for passengers is simply not strong enough – and ministers have sat on their hands for years and failed to introduce long-promised airline insolvency laws," she said.

The Unite trade union said the government had failed to learn lessons from Flybe's first collapse.