Tuesday, 2 October 2018

Primera Collpase year after Monarch lessons about Financial protection?

Primara Air B737.
Its now a year since Monarch collapsed and we have another airline collapse to the exact time and date a year later.

Primera Air an established carrier that had a very conservative reputation, seemed to have lost it's reluctance for risk last year when they started flying aircraft from the UK to the USA.

It was basing these on a new aircraft type the A321 neo which had the extended range to make the USA at a lower cost and a lower committed capacity.

Late deliveries of aircraft , over stretch of product, have led to its sad demise .

Anyone who has not paid by Credit card will loose most of their money as airlines do not have financial protection.  The CAA licences tour operators and travel companies, but have no legislation in place to force airlines to financially protect clients.

So lessons to be learnt by the travelling public, firstly check that any operator has an ATOL, if they don't then ensure you pay by credit card, as under the consumer and credit act 1973 if your purchase is over £100 then the credit card company has a joint responsibility to supply the goods or refund you.  Or alternatively take out a SAFI policy (Scheduled air Financial insurance), the costs are normally about £2-2.50 per person.

Companies I have been involved with Avro Plc, Flylolo.com have always had ATOL protection.  Flylolo goes further and issues a SAFI policy included in the headline price.

What other airlines will go bust in the next year?  Michael O'Leary (Ryanair CEO) predicted last year that Monarch and Norwegian would go bust, Norwegian are still here, so half right then Michael.

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