Last week thousands of holidaymakers woke to find that their carrier, Flyglobespan, Scotland’s biggest airline, had gone bust. The airline had denied earlier in the week that liquidation was on the cards, saying that Jersey company, Halcyon Investments, were about to offer a major funding package.
Like other airlines, Flyglobespan had been hit by the recession, making a loss of £19 million in 2007 – 2008 although a profit of £1.2 million for 2008 – 2009 had seemed to herald better times. Spiralling fuel costs and plummeting passenger numbers though were obviously too great an impediment to recovery. Not only were 5000 holidaymakers stranded abroad and 117,000 prospective holidaymakers facing disappointment, but 800 staff were left facing Christmas without a job. Apart from a small nucleus who will be employed to oversee the winding up of the company, all other staff members will be made redundant.
Ryanair and Easyjet were offering to fly stranded passengers home where routes overlap for fares between £60 and £89. Apart from flying to Mediterranean resorts, the airline also operated routes to Florida and Egypt.
Passengers who booked using a credit card or through an ATOL bonded agent should get their money back eventually but there are tens of thousands who had holidays booked who will lose their money, having used debit cards or booked flights only through the website. News was breaking at the weekend that the airline had been badly let down by the credit card handling agency, E-Clear, said to owe Flyglobespan £34 million. If even part of this sum had been in the airline’s bank account the crisis could have been averted, according to the Finance Minister.