According to all indications, 2023 will not be the year airlines dreamed of. So far this year, three airlines have gone bankrupt. At the same time prices are rising.
If there is one thing, that airlines have been looking forward to, it is the year of 2023. 2023 is marked as the year travel finally would return to normal after three years with the coronavirus.
However, just as we thought we have seen some small glimpse of hope at the end of the tunnel, the airline bankruptcies have returned. All the while prices are going up.
According to data from Flight Centre, CNN writes that Economy fares have increased by an average of 36% in price for 2023.
In addition to the rising prices, the total number of bookings has fallen by 22% globally for the first quarter of 2023 compared to 2019 – before the corona breakout. In particular small airlines are struggling to survive.
At the end of January, the Norwegian airline Flyr went bust with a billion in debt. Simultaneously, their 407 employees lost their jobs.
It happened three days after the British airline Flybe went bankrupt – a bankruptcy that was like deja-vu for the British passengers. It was the second time in three years that the airline went bust. The first time was in March 2020, but the British low-cost airline made a strong comeback two years later with both domestic routes and international flights. Ten months had to pass before Flybe yet again had to declare bankruptcy.
A total of 64 airlines went bankrupt during the corona crisis – mainly smaller airlines – according to aviation website and podcast AllPlane.tv. A few have found new life after going bankrupt or changing their name, but the vast majority is gone forever.
So how can you secure your air travel and avoid being stuck in a foreign country? How can you tell if your particular airline is on the verge of bankruptcy? What are the warning signs?
In this article you get more information about this.
Stay up to date with online research
Before you buy your airline tickets, you should do some online research of the airline. Visit their website and see how they’re doing.
Are you able to find a verified social media account? Does the airline respond to passengers on their sites? Does the airline have a Wikipedia page? If not this could be a sign of potential problems.
When your vacation approaches stay up to date with travel news. Make a plan ahead in case of any bad news about your airline and know when to act. For example if a stat government blocks the airline from selling tickets, this is a clear warning sign.
In this particular case you should decide whether to cancel the trip and request a refund. Alternatively, you could wait for the airline itself to issue an update.
Book your travel with a credit card
You should always use your credit card to book your travel. You can easily make a chargeback, and some cards even offer protection against trip cancellations or interruptions.
Your bank or credit card provider will refund the product or service – in this case the flight – if the service was not provided.
Following that, your bank or credit provider claims the money back from the airline’s bank instead of the airline itself. After all, your bank has more legitimacy than you do in this sort of situation, so it’s more prone to get your money back.
The system is the same in most countries where credit cards such as Visa, American Express and MasterCard are provided. Some debit cards may also offer chargeback, but this is rare.
Although credit cards occasionally come with annual fees, paying the fee can be cheaper than making other arrangements, including travel insurance.
Have travel insurance
Travel insurance is designed to cover unexpected costs while you’re travelling or on vacation. Travel Insured will cover you in the event of bankruptcy.
Research cautiously the travel insurance policy and make sure there is a clause in it that covers “financial insolvency” of travel suppliers.
It’s important to make sure it’s included, especially if you’re concerned about a bankrupt airline.
If worse comes to worst…
Unfortunately, you are usually not entitled to compensation when an airline goes bankrupt. But if you are in doubt as to whether your canceled flight entitles you to compensation, you can send us your case. We will quickly inform you, whether you are eligible. It costs nothing – we only take a small share of the compensation we may get for you.
You can use our website to find more information about EU261 passenger rights or call one of our experts during office hours on +45 8282 8585.
Also read about the British low-cost carrier Flybe suspends all flights – what are your rights?