Hundreds of job losses have been made after the bulk of Eastern Airways' 330 employees were made redundant as the company hovers on the edge of administration. Insolvency specialists are expected to be brought in at the Humberside Airport-based carrier, which grounded all its services this week.
Administrators from RSM Ƶ Restructuring Advisory are poised to take control of Eastern Airways (Ƶ) Limited and Air Kilroe Limited - the two entities comprising the Eastern Airways operation. They have said that the recent termination of a KLM contract, which had Eastern operating four aircraft for KLM Cityhopper, left the group burdened with substantial fixed costs and an unsustainable workforce.
Eastern executives were reported to have attempted a rescue mission for both companies but, facing a significant funding shortfall, the sole option was to halt operations and bring in advisors. Beyond the KLM arrangement, Eastern had been operating Ƶ routes under its own brand and providing charter services.
Mayor of Greater Lincolnshire, Dame Andrea Jenkyns, said: "This is deeply disappointing news and our foremost concern, as the Greater Lincolnshire Combined County Authority, is to ensure robust support for those impacted. We are actively collaborating with the Department for Work and Pensions (DWP) and local councils to assist individuals facing potential redundancy and to help them transition into new employment opportunities.
"We recognise the impact this will have on employees, passengers and regional connectivity and are committed to providing coordinated support throughout this challenging time.", reports .
Yesterday, Humberside Airport confirmed it would maintain "business as usual" operations should Eastern collapse. The carrier's downfall arrives more than two decades after its mid-1990s launch, which established connections between Humberside and the crucial oil and gas hub of Aberdeen.
As previously reported, the airline remained under Humberside Airport owner Bristow's control until six years ago, when it was acquired by Orient Industrial Holdings Ltd.
Jamie Miller, partner at RSM and proposed joint administrator, said: "This has been a very fast-moving situation but due to circumstances outside their control, and without a viable solution, the directors have had no choice but to cease day to day operations. Sadly, a majority of the 330 staff have had to be made redundant by Eastern.
"Sufficient staff have been retained to provide ongoing service and assistance to Eastern's valued customers, and to continue maintenance of the aircraft. For those staff not retained, we will provide every assistance to them to ensure they successfully claim their entitlements from the Redundancy Payments Service. We would welcome any interest from potential alternative operators, or those who may have an interest in the underlying assets."
In response to the suspension of Eastern's flights, rail operators including Hull Trains offered complimentary travel to Eastern customers and staff earlier in the week. The offer also included LNER, GWR, ScotRail, Transpennine Express and Northern.
GWR Operations Director, Richard Rowland, said: “We understand how difficult it must be for those affected by the sudden suspension of Eastern Airways flights. We’re pleased to be able to step in and help customers and staff complete their journeys, ensuring they can get to where they need to be.”
Selina Chadha, Consumer and Markets Director at the Ƶ Civil Aviation Authority, advised: "We urge passengers planning to fly with this airline not to go to the airport as all Eastern Airways flights are cancelled. Eastern Airways customers should visit the Civil Aviation Authority's website for the latest information."
Further information for Eastern Airways customers, including details on how to reclaim money, can be found on the Civil Aviation Authority's website.
