“Facing bankruptcy”: Air Vanuatu to be liquidated
Trouble in paradise as reports of possible bankruptcy swirl...
By David Flynn, May 10 2024
Air Vanuatu will enter voluntary liquidatation, with flights cancelled and passengers scrambling to find their own way between Australia, New Zealand and Port Villa.
However, appointed liquidators Ernst & Young Australia intend to allow the airline “to resume normal trading as soon as possible, while considering all opportunities to place the carrier on a stronger footing.”
“The outlook for the airline is positive, despite pressures on the broader industry, and we will be focused on securing the future of this strategically vital national carrier,” said EY’s Morgan Kelly, who will lead the liquidation team.
“Air Vanuatu is critical to the people of the Republic of Vanuatu and a strategically important business to the nation. Our team is working closely with management to ensure continuity of service to customers and to ensure services continue as seamlessly as possible.”
EY said the troubled airline faced not only the same pressure as the rest of the industry such as labour shortages and inflation, but has been particularly affected by disruption of tourism activity due to cyclones.
Air Vanuatu has flagged the possibility of selling off of assets to pay down its debts.
Reports in the Vanuatu Daily Post earlier this week claimed the airline was “facing bankruptcy”, while the government of the Pacific nation has previously raised the prospect of privatising the carrier.
Air Vanuatu yesterday confirmed the cancellation of all international flights from Thursday 9 May 2024 through to Sunday 12 May 2024 inclusive, while “all future flights after Sunday 12 May 2024 are currently under review.”
Air Vanuatu said it would continually update its Vanuatu Travel Advisory page with information for passengers.
Air Vanuatu’s network saw flights to to Sydney, Brisbane, Auckland, Noumea and Fiji from its hub at Port Villa.
Virgin Australia also has two direct flights per week between Brisbane and Port Villa, and the airline says it will increase those to five per week – on Monday, Wednesday, Friday, Saturday and Sunday – “for the remainder of May and June.”
Virgin also plans to “quickly commence a further seven weekly services from east coast gateways into Vanuatu” pending government approval.
“We are conscious of the impact this situation has on travellers, ticket holders and the industry and on behalf of the Vanuatu tourism industry extend our apologies to anyone affected,” noted the Vanuatu Tourism Office in a statement.
“This is an evolving situation and we will continue to post updates to www.vanuatu.travel.”
31 Mar 2014
Total posts 379
This explains why they have had a 737 sitting in Melbourne with a failed engine since early this year. I thought it odd they would leave a plane out of service for so long.
Virgin Australia - Velocity Rewards
24 Jan 2018
Total posts 716
Hmm, I wonder how well the partnership with QF really worked for them? I'd have thought Virgin was a better fit, with all flights to AUS connecting at BNE via the Virgin network. Oh well.
Qantas - Qantas Frequent Flyer
18 May 2017
Total posts 33
The schedules were all wrong for anyone outside of Brisbane trying to use Virgin Australia to Port Vila. I am in Canberra, and I would have had to overnight Brisbane at both ends of my trip. Going with Virgin would cost me $300 to $350 more as well, plus the 2 nights accomodation in BNE. Air Vanuatu's schedule was much more practical, and a lot cheaper, not having to do any nights in BNE.
Virgin Australia - Velocity Rewards
24 Jan 2018
Total posts 716
Agreed. Given the frequency of VA flights into BNE from CBR, SYD, MEL, etc., there should absolutely be no delay beyond 4 hours (and certainly not overnight) for the connecting flight BNE-VLI. As to whether current airfare prices charged between AUS and VLI are sustainable, seems they are not. Even adding $300 to MEL-VLI, that's still $300 less than the comparable VA airfare. Only NF can determine how many pax have QF code share to justify that particular partnership. But this is a golden opportunity for VA. It's been 18 years since I last holidayed in Vanuatu, but I'd not hesitate to return if I had the time.
01 Jul 2021
Total posts 39
First Bonza now them also what happens to there A220s orders?
07 May 2019
Total posts 14
I feel so sorry for their excellent pilots and cabin crew. The ground staff and management were infected with inappropriate leadership and woeful inexperience with airline operations, which we witnessed on all four occasions we flew with them. Their reaction to non-standard operations, sadly common, was laughable at best. While the airline's demise is no surprise, the beautiful people of Vanuatu will miss out badly. I hope Virgin and Qantas pick up the slack here, and do so quickly. A great holiday destination awaits them.
Qantas - Qantas Frequent Flyer
18 May 2017
Total posts 33
It is a sad reality, but I am not surprised. They've been struggling for a few years. Now with Air Vanuatu no longer operating in the foreseeable future, Fiji Airways or Air Calin will be the next best options for many people, both in terms of convenience and price. Both these airlines will also get a lot of demand from both New Zealanders and Australians wanting to travel to Vanuatu. Virgin Australia out of Brisbane is OK if you live in Brisbane, but their schedules are terrible if you are wanting to connect from anywhere else in Australia. You are forced to overnight in Brisbane the night before, and often on your return as well. I am not sure if Air Vanuatu's domestic services will be operating. They serve an essential service between islands in the Vanuatu archipelago... especially to Santo and Tanna. There are some smaller operators, but they only have a few small planes and no where near the capacity needed to make up for any loss from Air Vanuatu not operating. Air Vanuatu not operating is going to create a huge problem for Vanuatu's tourism industry.
01 Jul 2021
Total posts 39
I heard AirCalin is struggling a bit, Fiji Airways are on fire thought they are killing it I love the airline is finally getting the love.
Virgin Australia - Velocity Rewards
24 Jan 2018
Total posts 716
But Felipe, if NF consolidates its Pacific sectors to BNE-VLI only, they'd hopefully be able to run at least 2 flights (higher occupancy) daily, perhaps 3 flights, for the <3 hour flight. Whether they stay with QF, jump to VA, or go with both (if that's possible), it might save the day.
Qantas - Qantas Frequent Flyer
18 May 2017
Total posts 33
What will be happening to Air Vanuatu's domestic services, as they serve a crucial service in the archipelago?
Hi Guest, join in the discussion on “Facing bankruptcy”: Air Vanuatu to be liquidated