Good news for the british regional airline. The government has agreed to a rescue deal for Flybe.
The British government declined to bail out Monarch, Fly BMI and Thomas Cook. With Flybe, things are different. No other carrier offers as many domestic connections as the regional airline with the purple livery. It also connects many regions that are not doing well economically and need the connections.
«Delighted that we have reached agreement with Flybe’s shareholders to keep the company operating, ensuring that UK regions remain connected», business secretary Andrea Leadsom said in a statement on Tuesday (January 14). The rescue package, the details of which are not yet known, provides for a reduction in Air Passenger Duty to relieve Flybe.
Flybe becomes Virgin Connect
«We are delighted with the support received from the Government and the positive outcome for our people, our customers and the UK. Flybe remains committed to providing exceptional air connectivity for the UK regions with the full support of its shareholders», the airline stated in a press release.
Flybe pledges to continue its efforts, with the support of its shareholders, to provide air services to the UK regions. However, this is precisely where it has run into problems in recent months. Fierce competition from low-cost carriers, bus and rail and the rising price of fuel have led to increasing losses. For this reason, the regional airline has been hectically searching for a solution to avert the collapse in recent days.
Feeder for Virgin Atlantic
Last March, a consortium consisting of the American finance firm Cyrus Capital (40 percent), the British conglomerate Stobart Group (30 percent), which is also active in aviation, and Virgin Atlantic (30 percent) bought Flybe. It had subsequently invested 100 million. Flybe is to be renamed Virgin Connect in the current year and will increasingly serve as a feeder for the British airline.