Cobalt, the Cypriot airline, has collapsed overnight. Tens of thousands of passengers are waking up to find that their tickets for future travel to and from Cyprus and Greece are worthless.
The airline told the Cyprus Ministry of Transport at 9pm on Wednesday night that it would shut down shortly after midnight on Thursday.
A brief message on its website reads: “Cobalt regrets to announce that it will be cancelling all flights as of 23:50pm on October 17, 2018 due to indefinite suspension of Cobalt’s operations.
“As a result, future flights or services provided by Cobalt will be cancelled and will no longer operate.
“Passengers who have un-flown tickets are instructed not to go to Larnaca Airport or any departure airport tomorrow, 18 October 2018 as no Cobalt flights will operate and no Cobalt staff will be present.
“For refunds, please contact your credit card provider or travel agent.”
Cobalt flew from Gatwick, Heathrow and Manchester to Larnaca, its main hub, and from Gatwick to Athens. It offered connections to Beirut and Tel Aviv, and also served Frankfurt, Moscow and Paris.
The airline had been flying for barely two years. It was set up with the help of Chinese investors after Cyprus Airways shut down in January 2015.
The national carrier was grounded after the European Union ordered it to repay €100m (£87m in today’s money) in illegal state aid.
In response to the Cobalt collapse, the Cyprus Ministry of Transport said it was hoping for a “smooth and best possible operation for the repatriation of stranded passengers”.
Passengers booked to travel on Thursday were told to buy an alternative single ticket and seek reimbursement from the ministry.
Travellers booked in the coming week have been told to await further announcements.
UK passengers who are stranded in Cyprus by the Cobalt failure are likely to be offered “rescue fares” by other airlines, notably British Airways and easyJet. After Cyprus Airways stopped flying, BA flew people home from Larnaca for £75 one-way.
Travellers with future bookings who paid by credit card should be able to recoup the cost of tickets. But thousands of British passengers with half-term bookings to and from Cyprus will now be desperately looking for alternative flights.
The cheapest return on easyJet from Gatwick to Larnaca on Saturday 27 October, returning a week later, is £350, but this fare is likely to rise sharply once news spreads of the failure.
Travellers with bookings for Cobalt flights as part of a package holiday should be re-booked on an alternative airline at no extra cost.
Cobalt had six Airbus A319 and A320 jets, and had announced plans to acquire wide-bodied jets to fly to China, South Africa and North America.
Airlines across Europe are suffering from weak demand and the rising price of oil. Cobalt was also up against strong competition to and from the UK and on its key route between Larnaca and Athens.
Reports in local media suggest that Cobalt’s chief executive, Petros Souppouris, had been seeking funds from an investor.
The airline stopped flying after talks broke down. Its main asset is a pair of slots at Heathrow, which it inherited from Cyprus Airways.
The Cyprus Ministry of Tourism statement ended by expressing “deep sorrow for the cease of operations of Cobaltair Ltd and for the inconvenience that will be caused for passengers”.
At the start of October Primera Air collapsed, leaving tens of thousands of passengers stranded on either side of the Atlantic.
On Wednesday Flybe issued a profits warning.
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