Monarch Airlines collapses to leave 110,000 passengers stranded abroad

Monarch Airlines has ceased trading with immediate effect, leaving 110,000 passengers stranded abroad and roughly 300,000 future bookings cancelled.

Confirming that the Luton-based carrier had entered administration at 0400 BST on Monday, the Civil Aviation Authority (CAA) and the government have already begun chartering more than 30 planes to bring Monarch's customers back from abroad.

Transport Secretary Chris Grayling called it the UK's "biggest peacetime repatriation".

"Due to the unprecedented number of UK consumers currently overseas who are affected by this airline administration, the CAA and government are securing a fleet of more than 30 aircraft, flying to more than 30 airports, to bring 110,000 people back to the UK at no cost to them. This is the equivalent of operating, at very short notice, one of the UK's largest airlines," the CAA said.

Monarch, which employed about 2,100 people and posted a loss of £291m in its last financial year, was the fifth-biggest airline in the UK and the largest to ever go into administration.

The airline had been in talks with the CAA regarding the renewal of its licence to sell package holidays but had failed to reach an agreement by the Sunday evening deadline.

Grayling said, "This is a hugely distressing situation for British holidaymakers abroad – and my first priority is to help them get back to the UK."

One flight full of Monarch customers had already landed at Gatwick on Monday morning.

Monarch, which was founded as a subsidiary of Globus Getaway Holidays in 1968, carried 6.3m passengers to 40 different destinations in 2016.

Andrew Haines, chief executive of the CAA, said, "We urge people affected by the company's collapse to check our dedicated website monarch.caa.co.uk for advice and information on flights back to the UK. It also gives information to those passengers that have future bookings with Monarch but are yet to leave the UK."

The CAA stated all Monarch customers would be able to apply for a refund through the ATOL scheme, which provides refunds to customers in the event of an airline going bust.

Neil Wilson, a senior market analyst at ETX Capital said, "the failure of Monarch is good news for rivals," pointing out that "shares in Ryanair and EasyJet both rose about 3% in early trading as the market reacted to the news of the demise of Monarch after 50 years in business. IAG and Lufthansa were both about 2% higher."

"It means fewer seats to fill sector-wide – more than 6m in the case of Monarch. This should mean Ryanair and EasyJet can comfortably improve load factors, even if the reputation of the former has suffered of late. This should be positive for margins despite pricing pressures," he said. "No doubt this takes the heat off Ryanair but it has wider implications."