MIAMI – Flybe (BE) has ceased its operation and entered administration after 40 years.
The news closes a turbulent time for the company, which saw it negotiate a rescue deal with the British Government and its take over by Connect Airways, both efforts ultimately proving to be unsuccessful.
The airline carries 8.5m passengers per year between the UK and Europe, and represents 40% of the domestic services of the country, operating 120 routes, 88 of which are not flown by any other carrier.
Below is a chronological overview of the stages the company went through from its inception in 1979 to its downfall in 2020.
1979: Flybe is founded
Flybe was initially founded as Jersey European Airways (JEA) in 1979 as a result of an amalgamation of Intra Airways and Express Air Services. The initial fleet was Douglas DC3s; however, as these were already aging quickly, the airline refreshed its fleet with commuter aircraft.
At the time, the fleet included the Handley Page Dart Herald (which left the fleet in 1980 as Express Air Services left the airline), the Embraer EMB110 Bandeirante, the Brittan Norman Islander and the de Havilland Twin Otter.
When Walker Steel Group (WSG) bought a majority share in JEA, Exeter began to grow as a central hub to allow connections onto Spacegrand Aviation, based out of Blackpool, which was also owned by WSG.
1985: The Exeter hub push
1985 saw WSG after combining the Spacegrand Aviation and JEA, retaining the Jersey European Airways name. Further pushing Exeter as the central hub, their new headquarters was at Exeter Airport.
By this point, JEA was carrying 160,000 passengers a year, making an annual revenue of nearly £9 million.
JEA’s most significant break to the regional market came in 1997, with the announcement of a franchise agreement with Air France. Under the agreement, JEA would operate flights from London Heathrow to Toulouse and Lyon.
During that period, JEA had a variety of aircraft in their fleet made up of 12 British Aerospace 146s, four Fokker F27s, and two Short 360s.
June 2000 saw the first of two rebrands for the airline when Jersey European Airways became British European. The rebrand was due to the route network, no longer having Jersey as the primary focus; however, the name didn’t reflect that.
July 2002 saw the second rebranding to a shortened version, Flybe. It was at this point the airline moved its operation to a full service, low fare airline.
To create more capacity on their high volume regional routes, Flybe announced they would acquire 26 Embraer E195s, subsequently becoming its launch customer. However, as time went on, the fleet was also used for route network expansion.
Flybe announced a deal to purchase BA Connect in November 2006. The exception to the agreement was the services from London City Airport, which British Airways retained.
As a result, the owners of BE became Rosedale Aviation Holdings (69%), Flybe staff (16%) and the International Airlines Group (15%), after the acquisition process concluded.
Loganair became a franchise of Flybe at the end of October 2008. As part of the franchise, aircraft painted in the Flybe scheme flew on 55 routes throughout Scotland.
The next major expansion for BE was the start of operations from London City Airport. The five-year deal started with five aircraft, based around the Flybe network overnight but operating out of London City during the day.
2017: Shares fall by 75%
After nine years, BE’s franchise agreement with Loganair ended in October 2017. The result meant Loganair and BE came into direct competition on some Scottish routes.
Alas, the end of the franchise occurred only a few months after BE had started Scottish operations from London Heathrow, using slots previously utilized by Virgin Atlantic Little Red.
After BE’s shares fell by 75% in 2017, the world started to see that BE was in trouble. It placed itself up for sale, having rejected an offer earlier in the year from Stobart Air. At this time, the sale of the company was part of a range of strategic options to save the carrier.
As a result, a £2.2 million deal from Connect Airways was confirmed. Connect Airways is a consortium of Virgin Atlantic, and Stobart Aviation was set up explicitly for acquiring Flybe along with Stobart Air, the latter which would merge into the operation.
In spite of the merger, and operating under Virgin’s branding, the two operators were to keep their own Air Operators Certificate.
2019: Fruitless mergers and deals
Two days later, the deal was accepted – a total of £2.8 million for the total takeover bid, plus £10 million for immediate support of the company, with £80 million confirmed for later use. The deal completed on February 21, 2019. The new branding, Virgin Connect, was announced in October 2019.
Despite the funding given by Connect Airways, January 2020 saw Flybe return to the headlines once again with financial issues. This time, the British Government stepped in.
After talks with the airline, the British Government allowed Flybe to defer paying tax debts, as an attempt to keep Flybe going. The Government also launched a review of air passenger duty on domestic flights. These measures kept BE going for a little bit longer.
2020: The final nail in the coffin
In the end, the deal wasn’t sufficient, with Flybe entering talks with the British Government again, this time for a £100 million rescue loan. Due to the nature of the request, the EU had to be consulted to ensure the loan would not break any state aid laws.
The final nail in the coffin for BE was said to be the Coronavirus outbreak, with fewer people traveling than usual. This cast an overall doubt over the loan, which never came about.
Its been a few turbulent years for European aviation, and sadly, BE joins a long list of airlines that have recently gone under.
Blue Islands and Eastern Airways update
Blue Islands and Eastern Airways, both franchisees of BE, have each confirmed today they would continue to operate as normal. However, Stobart Air has canceled its flight from London Southend-Caen and Groningen, and the Isle of Man-Birmingham.
The sudden yet foreseeable demise of BE has caused confusion for its passengers; as a result, Eastern has sent notifications to its customers saying, “For any passengers who have received an email from flybe stating our flights are canceled, please ignore. Eastern Airways operated flights continue as normal.”
In its statement, Blue Islands said. “Blue Islands services will continue to operate as normal, following the closure of flybe. Blue Islands is saddened by the closure of flybe. Our thoughts are with the staff, passengers, industry colleagues and wider stakeholders of the business affected at this difficult time.” As of March 5, Blue Islands has been operating additional flights from Jersey and Guernsey to Birmingham and Exeter to cover the some of the immediate capacity shortfall left by flybe.
On its part, Eastern Airways said in its statement, “Passengers booked to travel today [Thursday, March 5], Friday or Sunday on flights operated by Eastern Airways should turn up and travel as normal following the closure of flybe.”