Air Belgium has announced that it is to close its passenger business and concentrate on cargo services and leasing aircraft to other carriers for cargo and passenger flights on an aircraft, crew, maintenance and insurance (ACMI) basis.
Passenger flights scheduled after October 3 have been cancelled and those travellers due to fly beyond this date will be reimbursed.
The cargo and ACMI operations are profitable and Air Belgium believes offer opportunities for growth.
The airline explained that the decision by the board of directors came about: “Following a series of external events that have weakened the company in recent years (COVID, the war in Ukraine, soaring fuel prices, inflation and falling consumer purchasing power).” It added that “in view of the current instability of the socio-economic and geopolitical environment” it was decided to cease the passenger business “which in the face of increased competition is proving to be chronically unprofitable to date.”
To address its current debt and return to profitability, Air Belgium's board of directors has filed for judicial reorganisation by way of amicable agreement. The company statement said: “Air Belgium has asked the business court to initiate judicial reorganisation proceedings. The court will examine the application in the coming days. If it concurs to open such proceedings, the company will be able to negotiate agreements with its creditors so as to reduce its debt. These agreements may include the negotiation of more favourable terms, the partial reduction of the existing debt and the deferral of interest. The proceedings are also intended to reorganise the company’s lines of business by disposing of or, where appropriate, discontinuing unprofitable activities which would have no prospect of viability if continued.
“The purpose of said proceedings is to ensure the company’s long-term viability, with no impact on the legal entity under any circumstances.”
The announcement to cease its passenger business on October 3 was only made on September 18. In light of this, the carrier stated: “Air Belgium is deeply sorry to announce the discontinuation of its passenger business at such short notice. All options for maintaining this activity or continuing flights after October 3, were examined, but the financial situation did not allow this.”
The Air Belgium fleet currently consists of five Airbus A330-200s, two A330-900s and three Boeing 747-8Fs.
