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Refunds to be Rejected as Air Berlin Stops Trading

Posted on November, 30 2017 by Blueway Limited

Refunds to be Rejected as Air Berlin Stops Trading

The prevailing uncertainty concerning Air Berlin’s future finally came to an end after the carrier announced that it would be shutting down its operations.

The German airline, which is said to be the 10th largest in Europe, recently declared bankruptcy and as a result, ended its operations on the 28th of October of 2017.

The carrier sent out a message to its employees mentioning that flights using the code “AB” would no longer be operating due to the current circumstances.

However, the flights operated by its subsidiaries, LG Walter and Niki, would continue to operate, according to the message.

Buyout Being Discussed

Air Berlin is said to be discussing a partial buyout with Lufthansa, Germany’s largest carrier, and EasyJet. However, no exact date was mentioned regarding when the discussions would end or when the deal would be made.

According to an aviation expert, John Strickland, Air Berlin’s closure had been expected for some time. He added that the only question left to ask now was how much of the carrier’s current operations would Lufthansa be able to take over.

What Went Wrong

Air Berlin declared bankruptcy as a result of the losses it had been facing for years. The bankruptcy had been pushed for by its largest stakeholder, Etihad, which refused to fund it any further.

The UAE-based carrier told the media that it was highly disappointed in Air Berlin’s performance, especially after lending massive support to it for over half a decade. One of its most notable efforts to support Air Berlin was in the form of a cash injection worth 250 million Euros.

Air Berlin is said to have suffered from an endless list of cancellations and delays. Another Etihad-controled carrier and Air Berlin’ greatest rival, Alitalia, also declared bankruptcy as it could not compete with budget carriers such as RyanAir and EasyJet.

In an odd incident, 200 of Air Berlin’s pilots called in sick without prior notice, causing over 100 cancellations in one day. Incidents like this had caused the carrier’s passenger numbers to drop by 24% in 2017.

This led to Etihad withdrawing its support and the subsequent order for the airline’s closure by The European Commission.

Air Berlin’s failure mirrors that of Monarch’s, which also shut shop earlier this month. The closure is considered to be one of UK’s biggest failures with regard to airlines. Being one of the UK’s largest operators, the carrier has now left 110, 000 of its passengers stranded and another 750,000 clueless about their flight status.

Some Air Berlin Flights Were Allowed to Fly

Some of Air Berlin’s flights were allowed to fly until October 28th. The carrier also stated that tickets booked prior to the insolvency would be refunded. However, tickets that were booked after the insolvency will not be refunded according to the airline.

This is due to the fact that there are insolvency regulations in place that prevent the carrier from refunding tickets booked after the company has been dissolved.

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