Airlines' collapse an 'eye opener'

Developments in the international aviation industry, including the possibility of significant job cuts by British Airways and the collapse of a number of small airlines, should be an eye opener for the local aviation industry, industry sources have said.

The sources said that a number of developments which were unfolding in the international industry were exposing its fragility.

Airline Jetmagic collapsed a few days ago leaving about 400 passengers stranded abroad. The fledgling Cork-based company ran into financial difficulties after failing to secure enough business over the winter months. More than 100 staff will lose their jobs.

Belgium's best-known charter airline Sobelair was declared bankrupt by the commercial court in Brussels. The court ruled that the loss-making company could not be kept afloat with further injections of capital, arguing bankruptcy offered the best guarantees for the firm's creditors.

Immediately after the ruling, Sobelair cancelled all of its flights, leaving around 1,400 angry passengers stranded at Zaventem international airport, north east of Brussels.

Sobelair was originally set up as a subsidiary of Sabena, Belgium's former national airline, which itself went bust in 2001.

The charter firm is a household name in Belgium, where countless thousands of families have used its holiday flights over the years. The firm employed about 480 people.

Another airline, Flying Finn, has managed to avert bankruptcy so far after a court ordered the current reorganisation process to be continued.

Over the last few days, British Airways announced a fresh package of savings which unions fear will lead to the loss of thousands of jobs, on top of 12,000 cut as part of last year's Future Size and Shape programme.