18:49 GMT27 January 2020
Listen Live
    Business
    Get short URL
    140
    Subscribe

    Flybe, which competes with BA along certain routes outside of London, was on the verge of collapse until the British government came to an apparent agreement with its shareholders on 14 January.

    UK government support for embattled airliner Flybe has been condemned by the head of British Airways (BA) parent company Willy Walsh, as a “blatant misuse of public funds”. Walsh, the chief executive of British Airways-owner IAG, said in an email statement that the Virgin/Delta consortium which owns Flybe “want the taxpayer to pick up the tab for their mismanagement of the airline”.

    Before Virgin/Delta consortium bought Flybe the airliner argued for its regional routes to be subsidised by public funds, the airline boss said.

    “Flybe’s precarious situation makes a mockery of the promises the airline, its shareholders and Heathrow have made about the expansion of regional flights if a third runway is built”, he added.

    Walsh, who is due to retire from his position with IAG in March this year, is also the chief executive of Irish airline Aer Lingus.

    The airliner competes with BA along certain routes outside London and was reportedly looking for funding to keep from collapsing.  

    On 14 January Andrea Leadsom the Minister for Business, Energy, and Industrial Strategy said in a Tweet that she was “delighted” to have reached an agreement with Flybe’s shareholders to keep it operating. The UK government was considering delaying £106 million in tax duty owed by Flybe in order to assist the airline, according to Sky News.

    The airline operates dozens of flights within the UK, as well as to other destinations in Europe, carrying an estimated eight million passengers a year. Approximately 2,300 jobs would be at risk were the company to fold.

    This will be the first such government intervention to save a well-known private company in as many years, after the state failed to intervene with larger corporations such as Thomas Cook, British Steel and Monarch Airlines.

    Related:

    UK Completes Return of Over 140,000 Clients of Bankrupt Travel Company Thomas Cook - CAA
    British Steel, 24,000 Jobs at Risk of Collapse if £30bn Gov't Loan Talks Fail
    UK Carrier Flybe Enters Last-Ditch Rescue Talks with Government Amid Rumours Company May Collapse
    UK Government Considering Tax Relief Rescue Package for Regional Airline Flybe
    UK Government Confirms Flybe Rescue, Pledges to 'Review' Air Passenger Duty
    Tags:
    Flybe, British Airways, UK
    Community standardsDiscussion
    Comment via FacebookComment via Sputnik