Zoom in administration; cancels all flights
29.08.08
Transatlantic budget carrier Zoom Airlines has suspended all flights and is applying to go into administration in its native Canada. A spokesman blamed its problems on the ‘horrendous’ price of jet fuel - which had added £27.3m to annual fuel bills - and the economic slowdown. The move follows problems in Canada and at Glasgow Airport yesterday.
The airline, which has flown since 2001, employs 450 staff in Canada and 260 staff in the UK, the majority at its Gatwick base. It operated flights from Gatwick, Glasgow, Manchester, Cardiff and Belfast, as well as Paris and Rome, to eight destinations in Canada, New York, San Diego, Fort Lauderdale and Bermuda.
The airline failed with 60,000 forward bookings, the Civil Aviation Authority said this morning. In addition, there are 4,500 UK passengers abroad left stranded by the collapse. Those due to fly with Zoom have been told to rebook with other airlines, and to contact credit or debit card issuers about refunds. BA and Virgin Atlantic are offering ‘special’ fares for passengers whose flights had been cancelled.
Zoom's co-founder Hugh Boyle told BBC News he ‘did not hold much hope’ of finding new investors to salvage the company. He said: ‘We are very, very sad and disappointed that we thought we could pull through this very difficult situation. We had some financing in place, but sadly it didn't come quick enough to avert some of the creditors who came in today to seize one of the planes, which resulted in a domino effect of the situation that we're faced with’.
In a statement, Mr Boyle and his brother John said they ‘deeply regretted’ having to suspend all Zoom operations. They said: ‘It is a tragic day for our passengers and staff. We are desperately sorry for the inconvenience and disappointment that this will cause passengers and those who have booked flights. We have done everything we can to support the airline and left no stone unturned to secure a re-financing package that would have kept our aircraft flying.’
Those whose flights are part of a package holiday should be able to make a claim under the ATOL scheme that protects holidaymakers from tour operators going bust. However, the CAA warned those passengers who booked direct with the carrier that they have to make alternative arrangements with other airlines, because the CAA’s ATOL scheme does not cover customers who book flights directly with airlines.
Passengers with forward bookings who booked using a credit card are advised by the CAA to contact their credit card company about refunds. Those who paid by debit or charge card should contact their card company for advice about full or a partial refund where only part of the journey has been completed, according to the CAA.
Customers with travel insurance should check their policy to see whether any airline insolvency cover was provided. Non-UK passengers are advised to contact their home country’s aviation / consumer protection organisation or their credit card company for advice and information about whether they are able to obtain refunds or assistance.
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