Zoom becomes latest casualty of aviation turbulence

Another airline has bitten the dust, as the demise of Zoom leaves hundreds of passengers stranded...

Last Updated: 31 Aug 2010

Zoom, an Anglo-Canadian budget carrier that operates out of five UK airports, was forced to suspend its entire operation last night after running out of money to pay the bills. This means that all of its flights have been grounded with immediate effect, leaving passengers in limbo on both sides of the Atlantic, while its staff face the prospect of imminent unemployment. On the Zoom website, founders Hugh and John Boyle said they were ‘desperately sorry’ and called it ‘a tragic day for our passengers and more than 600 staff’. Particularly those who’ll have to shell out for a new ticket to get home...

No prizes for guessing the major reason for the airline’s sad demise: like many before it, Zoom has fallen foul of the massive hike in oil prices, which has apparently added about £50m to its cost line in the last year. As a result, an airline that ended last year in the black has been forced firmly into the red – and with no prospect of things improving, it’s become the latest of about two dozen airlines (including the likes of Eos and Silverjet) to go to the wall as a result.

The Boyles claimed they had almost managed to agree a last-minute rescue package with their financiers, but their creditors apparently had other ideas. ‘Even late today we believed we had secured a new investment package to ensure future operations, but the actions of creditors meant we could not continue flying,’ the statement said plaintively. Reports suggest that air traffic controllers and refuellers refused to deal with the airline unless they were paid in cash, which Zoom obviously couldn’t afford to do.

It’s a sad tale – and hard to see what the Boyles could have done to avoid their fate, in the circumstances. But that won’t be much consolation to the hundreds of people whose travel plans have been thrown into disarray. Those who booked through holiday operators or with credit cards have a small chance of getting their money back, but everyone else will probably have to shell out for a new ticket with another airline. Zoom says BA and Virgin are both offering special deals for its passengers – but ‘special’ presumably doesn’t mean ‘free’...

So the aviation industry’s annus horribilis shows no sign of abating. And on the day that Aer Lingus also set alarm bells ringing by warning that it had to cut costs to stay afloat, it’s clear that there may be other casualties to come...

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