Yahoo Finance Bonza plunges into voluntary administration after passengers left stranded and planes towed
Tim Jordan has apologised for the cancellations and said they're trying to ensure the 'ongoing viability' of the company.
Low-cost airline Bonza has entered voluntary administration after passengers were met with signs saying their flights had been abruptly cancelled on Tuesday. People were left stranded as planes were repossessed, with vision showing them being towed from the tarmac.
CEO Tim Jordan apologised as he advised all services were "temporarily suspended" while he determined the "ongoing viability" of the business. Workers are trying to determine if their jobs are at risk, with a union boss claiming the "aviation is an industry on its knees".
There was shock and confusion at a handful of airports, like at Tullamarine in Melbourne, where Tracy Hilbert became stranded when the flight she booked to see her family following the death of her father was cancelled.
This was while ABC reporter Stephanie Ferrier revealed screens displaying the Bonza logo and flight information had been wiped, with no trace of the airline.
Have you been caught up in Bonza's cancellations? Email stew.perrie@yahooinc.com
"It's just really hard today because I should have been up there now and with my mum, my brother, and my other family," Hilbert told Today.
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"I've never had this problem before with them. It's only a two-hour flight. Now, it's going to take me all day to get up there."
Passenger Nicole Morris told the ABC they were meant to be flying home when confusion broke out.
"We just put our son on a plane to go and live in London, and we want to go home and I have just got here and some airport man out the front said, 'Your flight is cancelled'," she said.
"I have come in and I can't find anyone to talk to."
Routes in and out of the Sunshine Coast base as well as Melbourne flights to Rockhampton, Gladstone and Tamworth were all suspended.
Hall Chadwick have been appointed as administrator, according to documents filed with the Australian Securities and Investments Commission (ASIC).
Transport minister Catherine King consulted Qantas and Virgin to help stranded passengers, with the latter offering complimentary seats to those impacted.
King would not comment on whether a bailout was being discussed.
“It’s always really tough for a new entrant. So, we are a small market, despite the fact we are amazing travellers and we do want to travel everywhere and all the time. But we are a small market and it is always very difficult for new entrants,” King said.
TWU national secretary, Michael Kaine, described the situation as "extremely distressing time for workers and stranded passengers", agreeing an industry dominated by larger players made it very difficult for new competitors.
“Despite speculation of issues behind the scenes at Bonza, this is an industry dominated by aggressive competition and unchecked corporate greed that will squeeze out any new entrant," he said.
“Aviation is an industry on its knees."
'Bonza has finished': Staff reeling as CEO issues statement
Bonza had recently announced it would scale back flights, but Tuesday's statement from Jordan came as a shock to staff.
“We apologise to customers who are impacted by this and we’re working as quickly as possible to determine a way forward that ensures there is ongoing competition in the Australian domestic aviation market," Jordan said in a statement.
A man whose wife works for the airline revealed to the ABC that staff were told about the financial issues this morning.
"They just went in — there were two crews there — they were just basically told that Bonza has finished," he said. "They've been told that they're not flying until further notice.
"They've all been told that the bottom line is that Bonza will no longer be flying."
It had more than three dozen routes to 21 destinations across Australia and said it focused on flying routes that are unserved or underserved by other airlines.
Bonza claimed it has saved Aussies more than $100 million through its low-cost airfares and said it has flown more than 650,000 customers since taking off in February last year.
But it has faced financial instability in the past and had to cancel some routes.
The airline threw some customers’ Christmas plans into chaos in December when it cancelled all Darwin to Gold Coast flights for the month due to “regulatory approval processes”. This was done just hours ahead of its maiden voyage on the route.
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