Administrators are expected to be appointed to the airline soon
The majority of Eastern Airways’ 330 staff have been made redundant as the firm teeters on the brink of administration. Insolvency experts are expected to be appointed to the Humberside Airport-based airline, which suspended all its flights this week.
Administrators at RSM UK Restructuring Advisory are lined up to take over at Eastern Airways (UK) Limited and Air Kilroe Limited – two companies making up the Eastern Airways business. They say the recent cancellation of a KLM contract – which saw Eastern flying four aircraft for KLM Cityhopper – left the group with high fixed overheads and a workforce that was unsustainable.
Eastern bosses were said to have mounted a rescue effort for the two companies but, with a large funding gap, the only option was to stop flights and appoint administrators. In addition to the KLM work, Eastern had been flying UK routes under its own name and offering charter flights.
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.”
Yesterday, Humberside Airport said that it would continue “business as usual” in the event of Eastern’s collapse. The carrier’s demise comes more than two decades after it launched in the mid-1990s linking Humberside with another key oil and gas cluster in Aberdeen. As reported, the airline was owned by Humberside Airport owner Bristow until six years ago when it was sold to 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.”
Following news that Eastern’s flights had been suspended, rail operators including Hull Trains offered free travel to Eastern customers and staff. That offers extends to Wednesday, October 29 and includes other operators London and North Eastern Railway, ScotRail, Transpennine Express and Northern.
Selina Chadha, Consumer & Markets Director at the UK Civil Aviation Authority, said: “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.”
There is more information for Eastern Airways customers, including how to recoup money on the Civil Aviation Authority’s website.