Government confirms Flybe will continue to operate

Shareholders agree to put in more money

Flybe future uncertain

Britain’s biggest regional airline, Flybe, will continue to operate after rescue talks with the Government proved successful.

“Delighted that we have reached agreement with Flybe’s shareholders to keep the company operating, ensuring that UK regions remain connected,” said business secretary Andrea Leadsom. “This will be welcome news for Flybe’s staff, customers and creditors and we will continue the hard work to ensure a sustainable future.”

Flybe’s shareholders have agreed to invest more money in the airline, according to BBC business editor Simon Jack.

He tweeted: “Government pledges to review air passenger duty in run up to budget but will make changes in line with their zero carbon ambitions.”

Flybe has urged the government to consider an across-the-board cut in air passenger duty to help keep it flying.

Key Points

• Regional airline will continue to operate after shareholders agree to invest more money
• Government says it will review Air Passenger Duty tax in run-up to next budget
• 'This will be welcome news for Flybe’s staff, customers and creditors,' says Business Secretary

[13 January 2020 13:28 · Cathy Adams]

A Flybe insider reports: "Business as usual and everything is operating as normal."

[13 January 2020 13:39 · Cathy Adams]

Ben Cordwell, travel & tourism Analyst at GlobalData, said:

News that Flybe is rumoured to be in rescue talks to secure additional funding comes as no real surprise as a number of British airlines have struggled to operate in an increasingly difficult environment in recent years.

British airlines have been hit hard by the combination of a post-Brexit referendum slump and larger airlines like easyJet dominating slots at several key regional airports.

GlobalData figures show that the number of airline seats sold in the UK increased by almost 70 million between 2014 and 2019. However, Flybe has found it difficult to compete, accounting for only 3.4 per cent of the total seats sold in 2018.

With GlobalData forecasting the total revenue of the British aviation industry to grow by over $13 billion between 2019 and 2022, it will be interesting to see if smaller airlines will continue to struggle or be able to take advantage of the growing market. However, it is difficult to see how they will turn it around and win market share from the likes of Ryanair and easyJet.

[13 January 2020 14:00 · Cathy Adams]

Meanwhile here's a Flybe plane landing in strong crosswinds:

[13 January 2020 14:24 · Cathy Adams]

What went wrong at Flybe, and what should ticket-holders do?

The Independent's Simon Calder has put together this handy explainer here:

https://www.independent.co.uk/travel/news-and-advice/flybe-collapse-bust-administration-atol-flight-virgin-atlantic-stobart-a9280941.html

[13 January 2020 14:27 · Cathy Adams]

The BBC's Ben Thompson has shared a letter that Flybe chief executive Mark Anderson sent to staff today:

[13 January 2020 14:49 · Cathy Adams]

Simon Calder, The Independent's travel correspondent, has put together a handy Q&A about travellers' rights amid ongoing Flybe rumours:

https://www.independent.co.uk/travel/news-and-advice/flybe-financial-failure-possible-collapse-passengers-stranded-virgin-atlantic-rights-a9281741.html

[13 January 2020 15:23 · helen.coffey]

Specialist flight delay compensation law firm Bott and Co says that those affected by the potential Flybe collapse should: 

Investigate alternate flight options

Without scaremongering, it is advisable that anyone with a scheduled Flybe flight should look into alternative flights and have an idea of how much these will cost. 

Should the airline collapse, the government would work on assisting those stranded abroad in getting home in an operation similar to Operation Matterhorn, which was used to bring more than 150,000 Thomas Cook passengers back to the UK after it went bankrupt last year.  

Investigate alternate refund options

Any passengers who booked their Flybe flights as part of a package holiday through a UK travel agent will be covered by the ATOL protection scheme if the airline goes bust.This means the travel firm will be responsible for arranging alternative flights or providing a full refund. 

Those who have paid for their flights with a credit card may be able to recover their money, in full, under the Consumer Credit Act using Section 75. 

For flights which cost less than £100 or were paid for using a debit card, the Visa/MasterCard/Amex ‘chargeback’ system can potentially be used to recover the money paid. 

Not expect compensation for previous Flybe delays or cancellations

In reality, people who are currently in the process of claiming compensation for a flight delay, cancellation or denied boarding via EU Regulation 261/2004 are unlikely to receive it. Compensation claims falls to the bottom of the pile when an airline collapses, with money to secured creditors and airline staff coming first. 

[13 January 2020 15:57 · helen.coffey]

"Thinking of the crew and staff of our little purple airline Flybe tonight and for the near future," tweeted self-proclaimed Avgeek Lucy Isabel. 

"They supply not only jobs in their immediate ring, but further afield, propping up those smaller airports. The UK wouldn’t have an airline with many domestic routes outside of LHR."

[13 January 2020 16:16 · helen.coffey]

Stephen Farry, MP for North Down, calls Flybe's possible collapse "very worrying" for Northern Ireland.

[13 January 2020 16:31 · helen.coffey]

The British Airline Pilots’ Association (Balpa) has called on the government to do "whatever it takes" to ensure Flybe carries on connecting the nations and regions of the UK.

Balpa’s general secretary, Brian Strutton said: “If Flybe didn’t exist, it would have to be invented. The airline plays an incredibly important role connecting the regions and nations of the UK and onwards to Europe.

“The importance of that regional connectivity cannot be overstated. Cities such as Exeter, Southampton, Birmingham and Cardiff rely extremely heavily on Flybe for their air links and for their economic prosperity.

"Northern Ireland, the Channel Islands and the Isle of Man would also suffer hugely if Flybe’s routes suddenly disappeared.”

“We understand that talks are ongoing. The government must recognise that the UK cannot afford to lose yet another airline, and the markets that Flybe serves cannot afford to lose their air connections which help businesses thrive. So we urge the Government to take every possible action to keep Flybe flying.”