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Air Belgium ceases passenger activity
Air Belgium has announced that it will be ceasing passenger operations, describing them as “chronically unprofitable” due in particular to competition on the market.
For customers who have already purchased a ticket with the airline, flights scheduled before 3 October will be operated and return flights will be handled by Air Belgium, either directly or via other airlines.
Flights scheduled after this date and already paid for will be cancelled and refunded.
From now on, the airline will focus its development exclusively on cargo and chartering aircraft for other airlines, which it said offered growth prospects.
The company's board of directors has also applied for a judicial reorganisation by amicable agreement in order to pay off its debt, return to profitability and enable it to reorganise.
A court will examine the application in the coming days and, if approved, the company will be able to negotiate agreements with its creditors to reduce its debt.
“The court-ordered reorganisation procedure is designed to ensure the company's continuity, and under no circumstances is the legal entity destined to be impacted,” the company said.
Air Belgium indicated that the employees linked to the passenger activity will remain active during the procedure “and beyond”, with management intending to gradually reassign them to other activities.
The announcement was explained by a weakening of the company due to external events such as the pandemic, the war in Ukraine, soaring fuel prices and inflation.
In March, faced with the impossibility of passing on the increase in fixed costs to ticket prices, Air Belgium also cancelled flights to unprofitable destinations such as the Caribbean and the French West Indies.
It then concentrated activities on South Africa and Mauritius, while the capacity of the aircraft freed up was allocated to charter and cargo activities.
These obstacles have “severely affected” the profitability of the passenger business and the company's cash flow, Air Belgium said.
“While Air Belgium's budget forecasts anticipated a return to profitability in autumn 2023, the financial difficulties of the past, combined with the current uncertain and difficult environment, are prompting Air Belgium to change its strategy,” it added.
Created in 2016, the airline employs some 500 staff.