Slovakia’s low-cost carrier SkyEurope Airlines goes bankrupt, stops all flights

SkyEurope Airlines, the budget airline based in Slovakia, has declared bankruptcy because of what it described as the “shortage of sufficient interim funding to finance ongoing operations.’

Just before declaring bankruptcy on the midnight on August 31, 2009, SkyEurope had canceled 12 flights bound for various destinations, mostly from airport in Bratislava, (the capital of Slovakia), Paris and Prague.

The airline declared bankruptcy on September 1, 2009, and suspended its sales and all other operations.

In a press release, SkyEurope Airlines advised passengers who had bought flights with credit card to approach the bank that issued the credit to get refunds.

SkyEurope Airlines had started selling tickets for the winter season in July 2009 after adding 2 new Boeing 737-300 planes to its fleet.

The airline had, earlier in 2009, announced that its business had been severely hit by the worldwide economic recession and that it had been compelled to trim down its fleet of aircraft to just 5 from the 15 Boeing 737 planes in late 2008.

SkyEurope Airlines, the first low-cost carrier based in Central Europe, has been in the red for the past few of months. In fact, the company never earned profits during its existence.

Though the airline had obtained court protection from its creditors in June 2009, it had problems in getting permission to leave certain airports in France, Romania and Bulgaria, reportedly because of unpaid airport fees.

Later, SkyEurope found a new investor – Focus Equity, the investment group based in Austria – as well as got a loan worth 5 million euros. Focus Equity’s entry into the company had led to the extension of its commercial operating licence.

However, on August 14, 2009, Vienna International Airport in Austria stopped servicing flights by SkyEurope owing to what the airport described as “outstanding invoices.” A week before closing its doors to SkyEurope, Vienna International Airport had given the airline a grace period to settle unpaid invoices.

SkyEurope Airlines – set up in 2001 mainly by Austrian investors – had reported a loss of around 60 million euros ($85.63 million) in the 2007-2008 financial year and a turnover of 260.9 million euros.

SkyEurope –with bases in Bratislava (Slovakia), Prague (the Czech Republic), Vienna (Austria), and Kosice, a city in eastern Slovakia – operated short-haul scheduled and charter passenger flights.