Flybe ‘on brink of collapse’ as it urges government to cut air passenger duty – follow live

Britain’s biggest regional airline, Flybe, is reported to be in last-ditch rescue talks.

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

Normal operations are continuing, and the airline says: “Flybe continues to provide great service and connectivity for our customers while ensuring they can continue to travel as planned.”

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It highlights the fact we have no clear transport policy and that government fails to use carrots and sticks to nudge policy in direction of greener travel.

  • Cathy Adams
  • 14 January 2020 10:07

It’s not for Government to step in and save companies that simply run into trouble. But be in no doubt that we see the importance of Flybe in delivering connectivity across the whole United Kingdom. It’s very important, for instance, where I was yesterday in Northern Ireland, and we’re working very hard. I can’t go into commercially confidential discussions. We’re working very hard to do what we can, but obviously people will understand that there are limits, commercially, to what a government can do to rescue any particular firm. But what we will do is ensure that we have the regional connectivity that this country needs.

  • Cathy Adams
  • 14 January 2020 10:04

This is a poorly thought out policy that should be immediately grounded. The Government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel cheaper the next. Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport. The aviation sector has got away for years with increasing its carbon footprint. The last thing we need is another incentive for them to pollute more.

  • Cathy Adams
  • 14 January 2020 09:57

It would be completely unacceptable and even reckless if the government cut air passenger duty on domestic flights.
 
These short UK trips are exactly the ones we need to avoid in the drive to cut aviation climate emissions to help prevent climate breakdown. Instead the government could invest more in our rail system, and make such trips more affordable.
 

  • Cathy Adams
  • 14 January 2020 09:53

Yesterday’s news about Flybe was certainly very concerning for the industry, not least because of the local businesses and regions that benefit hugely from its service, so extreme measures should be considered in order to save the airline. The airline helps commuters to travel around the UK easily and taking away this service is going to affect a lot of people, and destinations that are currently only serviced by the airline.
 
Flybe is a hugely important airline for many areas of the UK and its passengers and air passenger duty is equally as vital in helping to reduce our collective carbon footprint, we would recommend that other measures are looked at first, but ultimately it’s great to see the government doing what they can to save an airline.

  • Cathy Adams
  • 14 January 2020 09:48
  • Cathy Adams
  • 14 January 2020 09:49
  • helen.coffey
  • 13 January 2020 18:03

Aviation consultant John Strickland told PA the failure of Flybe would have “a significant impact” on regional airports in the UK.

He said: “At a market level it doesn’t look like very much.

“But if you look at the regions [Flybe serves], it’s dramatic.”

  • helen.coffey
  • 13 January 2020 17:54

Flybe is reportedly planning a last-ditch plea begging ministers to defer its multi-million pound air passenger duty (APD) bill to help alleviate its cashflow crisis.

The airline has asked if it can delay paying its APD as it runs the risk of collapse, reports Sky News.

The idea of deferment is being discussed as part of a package of measures that are currently on the table during talks between Flybe’s owner, Connect Airways, and the government.

  • helen.coffey
  • 13 January 2020 17:39

Flybe is in urgent need of funding support following a period of sustained losses following a profit warning in October 2018. The consortium that acquired Flybe in early 2019, led by Virgin Atlantic, appears to have underestimated the level of financial support required by the business to effect a sustainable turnaround. The rescue talks are likely to consist of dual track process of continuing to sound out private investors, including the existing controlling shareholders, on one hand and the UK Government on the other, given Flybe’s position as a significant UK employer and Europe’s largest regional airline. A key part of these discussions will include an analysis of the potential financial outcome for each of Flybe’s financial stakeholders in the event of an insolvency, and the extent to which they can continue to provide short term support. As part of its contingency planning, Flybe’s management will already have lined up a potential administrator and would have been planning for some weeks in advance to take control of the Flybe’s operations and, most crucially, assets, should rescue talks fail.

  • helen.coffey
  • 13 January 2020 17:02
  • helen.coffey
  • 13 January 2020 16:31
  • helen.coffey
  • 13 January 2020 16:16
  • helen.coffey
  • 13 January 2020 15:57
  • helen.coffey
  • 13 January 2020 15:23
  • Cathy Adams
  • 13 January 2020 14:49
  • Cathy Adams
  • 13 January 2020 14:27
  • Cathy Adams
  • 13 January 2020 14:24
  • Cathy Adams
  • 13 January 2020 14:00

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.

  • Cathy Adams
  • 13 January 2020 13:39
  • Cathy Adams
  • 13 January 2020 13:28

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