Scotland's largest airline goes into administration

The collapse of Scottish airline FlyGlobespan leaves about 4,500 holidaymakers stranded abroad and 800 staff out of a job.

The collapse of Scottish airline FlyGlobespan leaves about 4,500 holidaymakers stranded abroad and 800 staff out of a job.


The Edinburgh-based airline unexpectedly went into administration on 16 December 2009 after it failed to secure a finance deal.

The airline immediately cancelled all flights without warning, leaving about 4,500 holidaymakers stranded abroad just a few days before Christmas.

The UK's Department of Transport and the Civil Aviation Authority had to arrange alternative ways to get the stranded holidaymakers back home, while other airlines such as Ireland's Ryanair were offering "rescue fares" to people affected.

The collapse of the airline and its parent company tour operator Globespan also affected about 117,000 people who had booked package holidays and flights only.

While package holiday customers are protected by the Air Travel Organisers' Licence (ATOL) scheme, flights-only customers are most likely to receive no compensation.

FlyGlobespan started operations in 2003 as an offshoot of the Edinburgh-based tour operator Globespan Group, which had been in business for over 30 years.

The Scottish airline had expanded rapidly, serving 24 destinations in Europe, North America and North Africa, and carrying more than 1.5m passengers in 12,000 flights in 2009.

The firm had posted a profit of £1.2 million for 2008-09, and just two days before going bust it had announced a forthcoming funding package saying "This is good news for the company, our customers and our staff."

Appointed administrators PriceWaterhouseCoopers stated that the airline had been hit by high fuel costs and a decrease in passenger numbers during the recession.

It also emerged that the airline's cashflow had been severely affected by an unpaid £34 million which was owed to the firm by troubled online payment company E-Clear.

The Scottish Government said the collapse of the airline, which meant the loss of about 800 jobs, was "extremely disappointing news" for Scotland.