Flybe
rescue fuels State aid complaint
On
14 January HM Treasury announced measures to keep regional airline Flybe in
operation prompting a State aid complaint from British Airways to the European
Commission.
Flybe
is the principal airline at regional airports in Belfast, Southampton and
Exeter. The government maintains that it
is important for regional connectivity.
The
full details of the rescue package are not available. However, The Guardian
has reported that this includes a potential loan, a short-term deferral of the Air
Passenger Duty (APD) charged on carriage of passengers from UK airports, and a
commitment to review the APD before the March budget.
Connect
Airways has pledged additional support alongside the government measures.
The
measures appear to have forestalled the immediate prospects of a third major
airline collapse in the UK in the wake of experience with Thomas Cook (September
2019) and Monarch (2017). Yet questions may
be asked about the longer-term viability of the Flybe model and how it can be
competitive both domestic and EU routes and with inland alternatives such as
road and rail.
Source:
https://www.theguardian.com/business/2020/jan/16/ryanair-demands-same-tax-holiday-amid-flybe-rescue-deal-backlash
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