Corona Virus Claims the First Airline

Low cost carrier Flybe has ceased operations:

Only five days ago, the boss of British Airways’ owner IAG warned that the coronavirus would push weaker airlines “over the edge”. Little surprise, then, that Flybe should be an early victim: a perennial struggler to turn a profit, flying routes that few others deemed commercially viable around the UK. But, even at such a geographical remove from the current outbreak, it is unlikely to be the last.

For now, the effects of Covid-19 on airlines echo the pattern among the human population: standstill in China, tolerated by the stronger carriers abroad, but potentially fatal to those less robust. And Flybe’s pre-existing conditions included an unusually onerous tax burden of air passenger duty affecting domestic flights, dampened demand alongside Brexit, and increased fuel and leasing costs from a falling pound. Its investors – a consortium led by Virgin Atlantic swooped in last year – had sensed a final opportunity after its share price had tanked; but by January they were begging the government, in vain, for assistance to stay alive.

 This will probably not be the last.

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