Flybe ‘grounds planes’ as firm on verge of imminent collapse

Flybe is facing fresh doubts over its future after failing to secure a £100 million loan – with reports flights have been grounded tonight amid speculation it is on the brink of collapse.

There are multiple reports of passengers being turned away at UK airports.

The struggling airline was saved from collapse earlier this year but has been unable to obtain the finance from the Government.

Following the reports of disruption to flights at Glasgow Airport, Flybe said there had been a "miscommunication" over refuelling of two services to Birmingham.

A spokeswoman said: "Flybe can confirm that, following a miscommunication regarding re-fuelling this evening, two flights were delayed and that due to the crew now being out of hours, have been cancelled. Normal operations have now resumed.

"We sincerely apologise to those passengers inconvenienced by the disruption to their travel plans."

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BBC News reports that Flybe is set to collapse within hours – putting 2,000 jobs at risk.

It is reported that the struggling airline will make an announcement ceasing operations after last in-air plane lands at 11pm.

Passengers reported being turned away from their flights as staff informed them there would be no more flights.

Peter Smith, an ITV journalist, tweeted: "Has Flybe just ceased operating in front of my eyes?

"Waiting to board a FlyBe flight to Birmingham and all of their flights have just been cancelled.

"Advice from staff is FlyBe 'definitely will not be flying out tomorrow either'.''

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People briefed on the regional carrier's situation told the Financial Times that the company only has enough resources to survive "until the end of this month".

Flybe has been hit by a slump in bookings since the outbreak of the coronavirus.

The coronavirus impact on travel "has made a bad situation much worse," insides told the BBC.

As part of the January rescue deal, it agreed an arrangement to defer tax payments of "less than £10 million" with HM Revenue and Customs.

Ministers also agreed to hold a review into Air Passenger Duty (APD).

The structure of APD – which adds £26 to the price of most return domestic flights such as those operated by Flybe – could be altered in next week's Budget.

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Garry Graham, deputy general secretary of the Prospect union, said: "Flybe provides important transport connections to and from parts of the UK where other viable options often don't exist.

"A number of regional airports are highly reliant on Flybe for most or all of their scheduled services.

"Reports that the Government may fail to provide the loan that is required as part of a package of rescue measures is very worrying.

"This risks the Government turning its back on these areas of the country and the workers at those airports.

"The Government needs to come forward with concrete proposals on how it will support the services Flybe provides and is a crucial test of its commitment to every region of the UK."

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Flybe serves around 170 destinations and has a major presence at UK airports such as Aberdeen, Belfast City, Manchester and Southampton.

It flies the most UK domestic routes between airports outside London.

A series of issues have affected the airline's finances, including rising fuel costs, falling demand, competition from road, rail and other airlines, plus a weakening of the pound.

It was bought by a consortium comprising Virgin Atlantic, Stobart Group and Cyrus Capital in February 2019, but has continued to make losses.

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Rival Ryanair has predicted the drop in demand for flights due to the coronavirus will result in some European airlines failing in the coming weeks.

A Flybe spokesman would not comment on its financial situation.

A Department for Transport spokeswoman said: "We won't comment on speculation."

At the time of Flybe's rescue, rival airlines complained that they should not be penalised for their own success and should also be given a tax holiday.

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