Struggling airline Flybe ‘set to collapse within hours’

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Airline Flybe is set to collapse within hours, putting 2,000 jobs at risk after a bid for fresh financial support failed, the BBC has learned.

The struggling carrier narrowly avoided going bust in January.

Exeter-based Flybe said the impact of the coronavirus outbreak on demand for air travel was partly to blame.

Its final airborne flights are expected to touch down at airports across the UK late on Wednesday evening.

Flybe, which serves many parts of the UK from the Channel Islands to Aberdeen, had been hoping for a £100m lifeline and changes to Air Passenger Duty taxes.

The carrier ran into difficulties last year and was bought by a consortium which includes Virgin Atlantic.

In January, the new owners said they would pump £30m into the business to keep it afloat, but appealed to the government for additional support.

While its financial problems were already apparent, a company insider told the BBC the impact of the coronavirus on the travel industry had “made a bad situation much worse”.

Virgin said this week its chief executive will take a 20% pay cut for four months, and the airline is freezing recruitment and offering employees unpaid leave as the coronavirus saps demand for air travel.

Bookings are 40% lower than a year ago, Virgin added.

Following last December’s general election, Prime Minister Boris Johnson pledged to “level up” the UK’s regions, after the Conservatives won seats in previous Labour strongholds.

In January Mr Johnson appeared ready to intervene to prop up the airline, considered a vital transport link to many parts of the country.

Passengers’ rights

Rory Bolland, travel editor for consumer group Which? said Flybe’s passengers were unlikely to have Atol protection, which would mean they would not be automatically flown home, as they would not have booked their flights as part of a package.

“Many popular travel insurance policies do not have cover for airlines going into administration, so many travellers may find they are not covered,” Mr Bolland said.

However some customers would be covered by their credit or debit cards. Customers whose flight was with a codeshare partner can claim the cost of their flight through that airline, he added.

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