Flybe

[Matt995]

Flybe is said to have implored airports to give it more time to find millions of pounds it owes them in unpaid landing fees.

Europe’s biggest regional airline held crisis talks with airports including Birmingham, Glasgow, Aberdeen and Southampton, according to reports.

It is said to be in a race against time to plug a multimillion-pound hole in its finances.

This is despite the government deferring a £10m air passenger duty tax bill earlier this month to help keep the airline afloat.

Sources told the Sunday Telegraph that Flybe, which is backed by billionaire Sir Richard Branson, had “got out it’s begging bowl”.

Chief executive Mark Anderson held talks with the airports. Insiders added that most are inclined to support the airline.

However, deferrals could be damaging to their own finances, as Flybe is one of the biggest players in their market.

Companies House filings show the airline has also effectively mortgaged assets such as its engines and buildings to Global Loans Agency Services (GLAS).

GLAS’ previous clients include Thomas Cook, Interserve and Carillion in the weeks before they went bust.

A Birmingham airport spokesperson said: “Flybe is an important carrier to us and the Midlands region but we do not comment on commercial terms concerning any of our airlines.”

Flybe looks for another tax delay, weeks after government saves airline

Flybe is said to have implored airports to give it more time to find millions of pounds it owes them in unpaid landing fees.

www.cityam.com

 

[Brum X]

I really hope BHX are getting cosy with Easyjet and are close to offering them a deal they cannot refuse.

This is not going to end well. I can feel it in my bones.

 

[Jerry]

I really hope BHX are getting cosy with Easyjet and are close to offering them a deal they cannot refuse.

This is not going to end well. I can feel it in my bones.

Well BHX is lucky. Other airports sadly won't have the option of Easyjet being able or willing to replace Flybe.

 

[Coathanger16]

Looking at the size of the UK, I'd certainly agree we have far too many airports. I'm sure 8 airports spaced at appropriate points around the UK would give everyone access to an airport within an hours driving time. It's ridiculous the amount of duplication there is, looking at a random day in August there's 49 flights to Alicante from mainland UK - do we really need that many?

Circling back to Flybe, the majority of their network isn't duplicated - as mentioned on here before they're the only ones operating a lot of routes or even the majority of routes from certain airports, so that must be maintained somehow.

 

[mullion]

Don`t even imagine that Easy would be the BHX saviour, wrong kind of carrier, wrong planes wrong schedules
Easy wouldn`t even be interested in most of the routes and if they did not 5, 6, 7 day, max 2 and would be no use for business customers as they work on booking a flight knowing that if the meeting overruns there will be another an hour or two later, add to that the A319 is going and will be gone soon leaving the A320/A321 which are way way to big
To put it mildly BHX, MAN and many other airports will be in the sh1t if they go and so will many of UK business customers
EXT to GLA would take 3 days to do a day of business by car/train as would SOU and even BHX and MAN would struggle due lack of space on trains and cost

 

[Rob c DSA]

Nightmare situation this, it does not look good for the aviation industry on these shores or the business community who rely on Flybe.

 

[Silvercity]

About 15 years ago some prominent person in aviation suggested that Great Britain being a small island had far too many airports and only needed eight. He named the eight but I can't remember what they were, any more than I can remember who the person was. I know it caused a lot of chat in aviation websites at the time although there weren't as many then nor as many people on the Internet.

I think we probably have got too many airports but the problem is that they tended to come into existence piecemeal. In the 20s and 30s there were a number of civic airports or aerodromes brought about by civic pride. Some still exist or have been moved to nearby sites in the areas concerned. Other airports were built on the site of redundant military airfields post WW2.

It was almost a scattergun approach with every town or city of any size wanting its own airport but with little joined-up national planning.

That seems to be the UK's general approach to transport as a rule !!

 

[Silvercity]

It would leave many areas isolated with people having to do long car journeys but some people don't really seem to care about that.

On an inadequate road network. Rail is the same. If the government are really serious about keeping regions links, and reduce Co2, UK needs mass electrification of the rail network and huge improvements in linking cities.

 

[Jerry]

On an inadequate road network. Rail is the same. If the government are really serious about keeping regions links, and reduce Co2, UK needs mass electrification of the rail network and huge improvements in linking cities.

Yes but I generally don't think that the country is capable of a project of that scale. I can't see Network rail having the resources and if it managed that by the time it finished it would all be obsolete.

 

[Coathanger16]

Begs the question, if these links are so important and no other carrier could come close to replicating them, why is Flybe in financial difficulty?

 

[GliderPilot]

Begs the question, if these links are so important and no other carrier could come close to replicating them, why is Flybe in financial difficulty?

This is what I keep coming back too... Rubbish business model or are the routes just not profitable?

 

[Jerry]

This is what I keep coming back too... Rubbish business model or are the routes just not profitable?

Or bad mismanagement over the years.

 

[paully]

Poor business model drawn up by poor management with too many underperforming routes as a result. What, in reality, it created was a perfect storm.

 

[Silvercity]

One of Flybe's problem is they have to offer a really fast service and I dont just mean the flight. Big airports are one problem, when you include the time you need to allow for parking security and just getting there, very often going to your local station and starting the journey can work out better.

 

[Silvercity]

Yes but I generally don't think that the country is capable of a project of that scale. I can't see Network rail having the resources and if it managed that by the time it finished it would all be obsolete.

I cant see running electric trains would be come obsolete. Just need political will to invest in transport, always very piecemeal in UK

 

[TheLocalYokel]

Poor business model drawn up by poor management with too many underperforming routes as a result. What, in reality, it created was a perfect storm.

Flybe was doing all right in the first decade of this century. It has rebranded as Flybe from its short-lived name of British European in 2002 (Jersey European before that) and rebounded well following warning signs around the time of the the Millennium and just afterwards. Its new Flybe name coincided with an attempt to embrace a low-cost business model.

By 2010 there was sufficient confidence in the company to float it on the stock exchange. The flotation price of 295 pence per share was oversubscribed twofold. The company made £66 million from the flotation half of which it said would be used to fund aircraft deals and the other half used as a cash balance. It had plans to add up to 140 Embraer aircraft to its then 68-strong fleet.

The flotation take-up suggests that the city had confidence in the company's future.

We know now that confidence was misplaced. Apart from an initial spurt to above the flotation price the share price began to fall over the years, with the occasional modest increase, but the underlying trend was one of almost continual decline. It's obvious in hindsight that the company overreached itself and this was compounded by almost desperate attempts under varying senior managements to try to find a way of turning the company around; none of it worked and in fact worsened Flybe's situation.

Its status as a publicly-quoted company meant that its financial performance was permanently in the public eye and, when the shares began to fall off the edge of the cliff, even people who have no interest in investing were aware that something was wrong with Flye with the news media constantly telling us how badly the shares were performing. This affected sentiment with potential passengers that fed into the ever-deepening Flybe depression. Eventually Flybe was disposed of for one penny per share.

Is the short-haul domestic market to secondary airports an impossible one in which to make money? Loganair and Eastern are in effect the only other two airlines left in this sector, albeit the latter is closely allied to Flybe. Loganair's owners saw its other airline, flybmi, cease to operate almost a year ago so it has to be hoped that they know what they are doing as they expand.

If it transpires that the domestic market, except between larger airports, is a basket case when run on commercial lines what is to be done? Subsidise airlines in some way either by easing or axing such things as air passneger duty, particularly between small airports? Effectively nationalise an airline to operate such routes? (would a Conservative government, especially a right-leaning one do that?). Let the market decide and if routes are only viable between certain airports then so be it?

 

[Ray Finkle]

easyjet may not be the answer to any potential gap left by Flybe but there are numerous markets from BHX where they are desperately needed.

No flights to Hamburg. Massive under capacity to Milan and Berlin which are now reduced to seasonal. Prague down to a ridiculous 2x weekly. Gibraltar gone and not looking like returning anytime soon. Lisbon returning (thanks to Jet2) but 2x weekly is nowhere near enough. Athens is back but only June-Sept. Toulouse still missing. Rome under capacity. Marrakesh still just once weekly. We then have the likes of Basel, Bilbao, Mykonos, Olbia, Brindisi etc which would all be welcome additions.

Even if Flybe pull through I think that easyjet is still needed.

 

[KJAY 786]

I would like to see British Airways make come back remember we are the city Common wealth Games 2022 lets see what happens and HS2 is coming soon they may come I hope.

 

[Nethercote2019]

BA = London airways

 

[andrew.clarkson]

Hi there all, with the commenwealth games due in the next two years, unless bhx gets their fingers out now and starts to arrange direct flights from every commonwealth country that is due to compete in Birmingham, then it will be total humiliation on those faces responsible.. Andyc