devonexpress
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Is there any news on the Flybe rebrand. Originally it was due to happen this month (Jan 2020) now it apparently won't be until March or the middle of this year.
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Flybe rebrand to Virgin Connect
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WatcherZero
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Theres trouble, they announced last week job losses at the Exeter HQ due to restructuring which is to be expected, but this weekend theyve been in talks with government about administration or bailout as its been discovered the £100m pledged for restructuring by Virgin/Stobart/venture capital isnt going to be enough as losses are higher than expected.
Bletchleyite
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Whoops.
transmanche
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The Independent's Simon Calder says:
The Sky News report mentioned is: https://news.sky.com/story/regional-airline-flybe-in-frantic-bid-to-stave-off-collapse-11907407
The Sky News report mentioned is: https://news.sky.com/story/regional-airline-flybe-in-frantic-bid-to-stave-off-collapse-11907407
Bletchleyite
Veteran Member
One problem with this report is that they are now more likely to collapse because people will hold off on bookings and their cashflow will near stop (it's usually a lack of ready cash[1] that kills businesses, not profitability - I never really understood this until I did an accountancy module at the OU - business accounting is nothing like the way we run our personal accounts or how charity accounts run which I was previously familiar with). I suspect this means they are unlikely to survive without a bailout.
[1] Bank balance rather than actual notes, but this term is used to distinguish from notional value in assets which does exist but can't easily be converted to money in the bank. For instance you might own a £30K car but if you need £10K today and can't borrow it you are near-stuck.
[1] Bank balance rather than actual notes, but this term is used to distinguish from notional value in assets which does exist but can't easily be converted to money in the bank. For instance you might own a £30K car but if you need £10K today and can't borrow it you are near-stuck.
Failed Unit
Established Member
I agree sadly that these reports normally start the spiral to the end.
look recently at Thomas Cook. Once it was announced they were in trouble I would avoid them if another company was offering what I wanted to the same destination. Why? Because although I am insured / ATOL protection exists it doesn’t help with the hassle of rebooking everything if it comes down to it.
the uncertainty will stop people booking. Which means the need to lower their prices and / or the losses increase. The rebrand may help the survival but if it is in deep trouble virgin wont want their name on it.
look recently at Thomas Cook. Once it was announced they were in trouble I would avoid them if another company was offering what I wanted to the same destination. Why? Because although I am insured / ATOL protection exists it doesn’t help with the hassle of rebooking everything if it comes down to it.
the uncertainty will stop people booking. Which means the need to lower their prices and / or the losses increase. The rebrand may help the survival but if it is in deep trouble virgin wont want their name on it.
Tetchytyke
Veteran Member
I'm moving to the Isle of Man in three weeks and I'll admit I'm worried. In the short term I'll book with EasyJet to Liverpool instead of Flybe to Manchester, but if Flybe fail the island will be cut off. Flybe have the contracts for healthcare transfers to Alder Hey, among other things.
That said, most Flybe flights to the island are now actually flown by Stobart Air using ATR72s, so I'm sure it'll be easy enough for Stobart to fly under a different booking scheme if needed.
As @Bletchleyite points out though, people switching will cause issues for Flybe, as cashflow will be impacted.
Easyjet have been the biggest headache for Flybe for a long time though. Flybe build up a domestic route then EasyJet muscle in on the lucrative bits with bigger planes and cheaper fares, but EasyJet only run at the popular times. We've seen that on the island, EasyJet muscled in on the London and Belfast flights, so there's now no Heathrow flight and the daily Belfast flight is now twice weekly (Friday and Monday for the weekend traffic).
I wonder if Virgin are actually planning a pre-pack administration to get rid of expensive lease agreements? Flybe have said for a while they want shut of the Embraers, and now Stobart are taking over some routes with the cheaper ATR72 they may also want rid of some Q400s.
That said, most Flybe flights to the island are now actually flown by Stobart Air using ATR72s, so I'm sure it'll be easy enough for Stobart to fly under a different booking scheme if needed.
As @Bletchleyite points out though, people switching will cause issues for Flybe, as cashflow will be impacted.
Easyjet have been the biggest headache for Flybe for a long time though. Flybe build up a domestic route then EasyJet muscle in on the lucrative bits with bigger planes and cheaper fares, but EasyJet only run at the popular times. We've seen that on the island, EasyJet muscled in on the London and Belfast flights, so there's now no Heathrow flight and the daily Belfast flight is now twice weekly (Friday and Monday for the weekend traffic).
I wonder if Virgin are actually planning a pre-pack administration to get rid of expensive lease agreements? Flybe have said for a while they want shut of the Embraers, and now Stobart are taking over some routes with the cheaper ATR72 they may also want rid of some Q400s.
Howardh
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Was booking a flight with them last week but changed my mind, glad I did!
Howardh
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Totally, I won't be booking my March break with them now. Thousands of others will do the same. Now if there was a complete money-back insurance per ticket (maybe a fiver) on flights under £100 then OK - I would do that. But all we have is chargeback for credit cards over £100; and huge premiums for insurance and for day-trips they don't want to know.
Bletchleyite
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Er, how? Are Sleasy stopping the route?
I imagine they will reconsider if Flymaybe do fold.
Howardh
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Flight Airport Scheduled Time Flight Status (From IOM)
Today Mon 1229
EZY854 Gatwick 09:55 Delayed overnight
BA3285 London City 13:15 Cancelled
BE605 Liverpool 16:10
BE816 Manchester 16:10 Cancelled
BA3287 London City 17:10
EI3217 Dublin 17:35
LM314 Edinburgh 17:55
BE820 Manchester 18:45
EY7031 Manchester 18:45
EK4190 Manchester 18:45
BE609 Liverpool 19:05
IOMPOST East Midlands 20:35
Aer Lingus, FlyBe*, British Airways, Easyjet, Loganair* four airlines to GB and one to RoI so there are alternatives
* are Loganair and FlyBE closetly related (anyone??)
Today Mon 1229
EZY854 Gatwick 09:55 Delayed overnight
BA3285 London City 13:15 Cancelled
BE605 Liverpool 16:10
BE816 Manchester 16:10 Cancelled
BA3287 London City 17:10
EI3217 Dublin 17:35
LM314 Edinburgh 17:55
BE820 Manchester 18:45
EY7031 Manchester 18:45
EK4190 Manchester 18:45
BE609 Liverpool 19:05
IOMPOST East Midlands 20:35
Aer Lingus, FlyBe*, British Airways, Easyjet, Loganair* four airlines to GB and one to RoI so there are alternatives
* are Loganair and FlyBE closetly related (anyone??)
Failed Unit
Established Member
Yes. Logan air used (maybe still do) operate flights for Flybe.
In the past it was a LoganAir flight in flyBe livery and it was LoganAir operating the majority of flights north of the central belt.
I think flyBe started operating themselves and LoganAir operation became independent but don’t know if that applied to all routes.
Cut off might be a strong term, but it looks like of the 53 flights this week from the Isle of Man to North West England, 46 are Flybe, and Easyjet don't fly at all some days. Easyjet aren't awash with spare capacity especially with the Thomas Cook situation, so it might be time to book ferry tickets if you want to get to the island.
Failed Unit
Established Member
I know someone that used to fly on business from Edinburgh. More then 3 people travelling at once it was cheaper to charter a flight.
Tetchytyke
Veteran Member
Nearly everything off the island is Flybe. Most of the main links- Liverpool and Manchester- are Flybe.
EasyJet don't run many daily flights- there's only a daily flight to Liverpool (from Feb- it's not currently daily) and Gatwick- and Loganair do run a daily flight to London City.
Loganair and Flybe are no longer linked, but Flybe and Aer Lingus Regional are- they're both Stobart.
EasyJet have undoubtedly been part of the problem for Flybe, dumping capacity on domestic routes but cherry-picking the most popular flight times.
I'm booked on a Flybe service - Groningen to Southend - in March, which is shown on my booking as operated by Stobart Air. Is this just a code share like the bigger airlines operate, or is it a different arrangement? And in any case, if Flybe go bust between now and then, what's my position regarding this flight? If it still flies, does my Flybe booking get me on to it? If not then I can afford the ~£30 that I paid for the ticket, but I'm wondering if it's best to start looking at arranging an alternative sooner rather than later?
Bletchleyite
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It's operated under contract and is very unlikely to operate if Flybe fold.
WatcherZero
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Use credit cards, book hotel and flights together so you get ABTA coverage.
Its unlikely Flybe will be allowed to fold, It has more than 2/3rds of the regional market outside London and would hardly do the government good if their priority of converting votes to permanent got off to such a bad start with the collapse of THE UK domestic airline. They've been in talks with Government about deferring their tax bill, and the issue they seem to be encountering which has brought them so quickly to the brink is they cant borrow money on the private market. Its possible the Government could step in as a lender of last resort and back their loans, not giving them cash but helping them to secure the credit they need.
Its unlikely Flybe will be allowed to fold, It has more than 2/3rds of the regional market outside London and would hardly do the government good if their priority of converting votes to permanent got off to such a bad start with the collapse of THE UK domestic airline. They've been in talks with Government about deferring their tax bill, and the issue they seem to be encountering which has brought them so quickly to the brink is they cant borrow money on the private market. Its possible the Government could step in as a lender of last resort and back their loans, not giving them cash but helping them to secure the credit they need.
As we are still subject to EU law how will that fly with state aid rules?
I assume the change in the rules so insolvent airlines can keep flying hasn’t happened yet?
Could the government nationalise it as a prepack out of admin so there can be an orderly sell off of the routes etc? It worked for the banks but not sure the lessors of the planes would play ball.....
I assume the change in the rules so insolvent airlines can keep flying hasn’t happened yet?
Could the government nationalise it as a prepack out of admin so there can be an orderly sell off of the routes etc? It worked for the banks but not sure the lessors of the planes would play ball.....
I am sure this is a very difficult time for every FlyBe employee, hopefully this can be resolved but why should anyone bail them out when it seems inevitable they'd just be pouring money down the drain and Virgin and Stobart have already discovered to the tune of £100m. IOM hardly cut off by this; two sailings each way (weather permitting) Douglas > Heysham in the winter and minimum four sailings (including Douglas > Liverpool) in the summer. In any case this is a popular route so I am sure someone will take on the slots if they become available
devonexpress
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I have to admit this news took me by surprise. However I think tomorrow will be bad news for Flybe.
matacaster
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Yes, its lack of working capital / easily realisable capital and that kills most firms. (eg it it may take ages to sell a valuable asset company owns (unless at a fire sale price and that may not cover debts). Someone might lend company money against it, but charge punitive interest if they believe company are desperate. Meanwhile creditors want payment, you can't do it, so insolvency proceedings and ultimately company folds.
Tricky Dicky and his little consortium stuffed the original owners by getting a lame duck for £2.2m. He has form on this. Look at Northern Rock, got it for a song, made pots of money because Govt believed his figures / usual underdog saves business story. Billionaire Branson himself could provide tens of millions of working capital for Flybe, let alone input from other partners. They other partners have cold feet as they know its a basket case and the 'promise' of £100m is likely to remain just that, no significant monies actually materialising.
My bet is it goes into administration and Branson engineers a pre-pack for sod-all discarding a load of unprofitable routes and getting out of various airports, ditching many older planes and making many of the staff redundant. The profitable routes will survive.
Branson is not at all like his cuddly, concerned for environment image at all. He's a very hard-headed businessman and wont invest in something that's a basket case.
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matacaster
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Yep, think that would work. I am pretty sure that or more likely a Branson pre-pack for £1 plus ditching all debt, crap routes, excess staff, older aircraft, leave a few airports. Finger in air estimate, likely an airline around one third current size might be profitable
edwin_m
Veteran Member
They said they would introduce some rules like that after Thomas Cook - basically some measure to keep the flights going for a couple of weeks so nearly everyone could get home without the government having to spend big money chartering rescue flights while the bankrupt ones just sit on the tarmac somewhere. I don't know if anything was actually done.
Belperpete
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I think they have been pre-occupied with other things. In any case, such schemes take years to get going.
Belperpete
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Which government are you talking about? The IoM isn't in the EU (see how much you get charged to use your mobile phone on the island).
The Manx government supported the Steam Packet to ensure they kept going. However, I can't see the Manx government rescuing Flybe in order to save just the Manx routes.
There will also be other places, such as the Channel Islands and Scottish islands, that would be hard hit by the failure of Flybe.
Bletchleyite
Veteran Member
More likely they'll contract another airline to put the flights back on on a subsidised basis if they're felt to be socially necessary, a bit like the Scottish Island services. Loganair or Stobart Air could perhaps do this directly.
I do wonder how much longer Flybe is likely to exist given that regional flights have been falling for some time now.
With HS2 likely to cut regional flights further, as well as the desire by more and more people to be green, the future isn't looking all that rosy.
With HS2 likely to cut regional flights further, as well as the desire by more and more people to be green, the future isn't looking all that rosy.
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