LONDON • British short-haul carrier Monarch Airlines ceased trading suddenly yesterday, following a financial collapse, the biggest failure of its kind in Britain, prompting the government to take emergency action to fly home 110,000 stranded passengers.
Monarch and its holiday business entered administration, with KPMG appointed to oversee the financial chaos that has left about 2,100 employees likely having to find new jobs.
"We're sorry to announce that Monarch has suspended flights and holidays," the budget carrier said on Twitter.
The airline had been struggling financially until majority shareholder Greybull Capital pumped £165 million (S$300 million) into the company last year to let it retain its licence to carry on selling package holidays and fund growth plans, as the sector faced turbulence from Brexit and terrorism.
But the Civil Aviation Authority (CAA) in Britain decided not to renew the airline's licence when it expired at the end of last month.
The CAA yesterday described the situation as "the biggest-ever UK airline failure", adding that "all future holidays and flights provided by these companies have been cancelled and are no longer operating".
It added in a statement that "the government has asked the CAA to support Monarch customers currently abroad to get back to the UK at the end of their holiday at no extra cost to them".
Future bookings cancelled.
Total passengers affected.
Staff who will likely have to find new emplo
Passengers are being flown back from numerous countries, including France, Greece, Israel and Turkey on aircraft leased by the CAA. In total, about 410,000 customers are affected, including 300,000 with future bookings.
Qatar Airways had sent A320 aircraft on request by the CAA to repatriate holidaymakers, according to online flight-tracker Flightradar24.
The government said it was overseeing the biggest repatriation since the end of World War II. "This is a hugely distressing situation for British holidaymakers abroad and my first priority is to help them get back to the UK," Transport Secretary Chris Grayling said.
He added: "That is why I have immediately ordered the country's biggest peacetime repatriation to fly about 110,000 passengers who could otherwise have been left stranded abroad... This is an unprecedented response to an unprecedented situation."
The first plane to arrive back in Britain carried 165 passengers from Ibiza. Affected parties used social media to get their messages across, mirroring the situation a week ago when low-cost Irish carrier Ryanair cancelled thousands of flights as it battled a shortage of pilots.
"Monarch customers in the UK: don't go to the airport. There will be no more Monarch flights," the budget carrier said on Twitter.
KPMG partner and joint administrator Blair Nimmo said "mounting cost pressures and increasingly competitive market conditions in the European short-haul market have contributed to the Monarch Group experiencing a sustained period of trading losses".
Monarch's collapse, meanwhile, boosted the share prices of its bigger rivals. "Usually what's bad for one airline - higher fuel costs, terror attacks, air traffic control strikes - are bad for the sector," noted Mr Neil Wilson, senior market analyst at ETX Capital.
"But the failure of Monarch is good news for rivals. Shares in Ryanair and EasyJet both rose about 3 per cent in early trading as the market reacted to the news of the demise of Monarch after 50 years in business."