MELBOURNE, Australia (AP) — Air Vanuatu filed for bankruptcy protection on May 10, a day after the South Pacific state-owned carrier canceled all international flights, leaving thousands of travelers stranded.
The airline on May 8 canceled more than 20 flights between the Australian cities of Sydney and Brisbane and the New Zealand city of Auckland for the remainder of the week. The airline said this was the result of “extended maintenance requirements” on its aircraft.
Ernst & Young Australia said in a statement that the firm’s Morgan Kelly, Justin Walsh and Andrew Hansen were appointed liquidators in what amounts to a US Chapter 11 bankruptcy. Liquidators said safety and maintenance checks would be carried out before normal operations could be resumed.
Kelly said the airline’s existing management team will remain unchanged.
“Air Vanuatu is vital to the people of the Republic of Vanuatu and is a business of strategic importance to the country,” Kelly said. “Our teams are working closely with management to ensure continuity of service to our customers and ensure that services are delivered as efficiently as possible.” May continue seamlessly.”
He added: “Despite pressures across the industry, the airline’s outlook remains positive and we are focused on securing the future of this strategically important national carrier.”
Affected passengers will be notified of the flight disruption and will be rebooked as soon as operations resume, the statement said.
Air Vanuatu operates four aircraft, including one Boeing 737 and three turboprop aircraft.
Tourism contributes 40% of Vanuatu’s GDP.
Vanuatu Tourism apologized to tourists for the disruption caused.
“The situation is constantly evolving and we will continue to issue updates,” the office said in a statement.
Adela Issachar, the office’s chief executive, said administrators were in discussions with Virgin Australia and Fiji Airways, which currently serve Vanuatu, about transporting stranded passengers.
“An updated timetable should be communicated shortly, so we’re all looking forward to that,” Issachar told the Australian Broadcasting Corporation.
Kelly said Air Vanuatu has been affected in recent years by labor shortages, rising operating costs, rising interest rates and tropical cyclones impacting tourist numbers.
“We will consider all options. The Vanuatu government has said they want to resume operations as soon as possible. Our role as voluntary liquidators will be to assess all options to achieve that and make it sustainable,” Kelly told reporters.
“So that may involve some kind of sales process, it may involve some kind of partnership arrangement with another airline,” Kelly added.
Australian tourist Sally Witchalls said that on May 8, she and four friends were checking out of a hotel in Port Vila, and the receptionist informed them that the Air Vanuatu flight would not depart that day.
She has since discovered that her travel insurance does not cover airlines like Air Vanuatu that go into voluntary administration or become insolvent.
“We are now doing our own research on how to pay for accommodation from now on while waiting to see how the situation develops with Air Vanuatu,” Wycharles told the ABC.
