Coronavirus has proved to be the final straw for European airline Flybe, which has fallen into administration.
Flybe narrowly avoided collapse in January after its parent group and the UK Government stepped in with a multi-million pound rescue package.
But the dip in passenger numbers as a result of the Covid-19 outbreak “made a bad situation worse”, according to an airline insider.
A statement in its website says Flybe entered administration on 5 March and EY has been appointed as the administrator. The statement adds: “All flights have been grounded and the UK business has ceased trading with immediate effect.”
Flybe bosses said the outbreak of the coronavirus and the impact it has had on air travel was partly to blame for the collapse.
Flybe chief executive Mark Anderson sent a letter to the airline’s staff apologising for failing to secure the funding needed to turn the carrier around.
Flybe has entered administration.
All Flybe flights are cancelled. Please do not go to the airport as your Flybe flight will not be operating.
For flights operated by franchise partners, passengers should make contact with their airline.#Flybe pic.twitter.com/O9vQ7mvnR8— UK Civil Aviation Authority (@UK_CAA) March 5, 2020
He wrote: "Despite every effort, we now have no alternative - having failed to find a feasible solution to allow us to keep trading.”
Flybe employed nearly 2,500 staff.
It is the second British airline to cease trading in just six months, following Thomas Cook’s collapse last September.
Flybe’s parent group, Connect Airways, which includes Virgin under its umbrella, has taken measures to mitigate the impact of the virus.
Virgin’s chief executive said he will take a 20% pay cut for four months and staff are being offered unpaid leave after bookings fell 40% compared to the same period last year.
Airlines around the world are taking measures to cut costs.
Some 25,000 employees at Cathay Pacific agreed to take leave after its CEO made a request. In Dubai, Emirates offered crew paid and unpaid leave.