Zoom Airlines, the low-fare scheduled trans-Atlantic airline based in Ottawa, Ontario, Canada, has suspended operations and has sought protection from creditors in Canada and the United Kingdom after many of its aircraft were detained for non-payment of leasing fees and other fees.
Zoom’s planes were detained at Calgary Airport in Canada and Glasgow Airport in the United Kingdom because of financial problems.

Though the airline had earlier said that it would continue to operate, it closed down its website on August 28, 2008.

Zoom Airlines, which has been in business since 2002, said in a statement: “The carrier is ceasing operations and that all its aircraft have been grounded. The action is the result of acutely difficult conditions in the airline industry. Our trading position is a direct consequence of the horrendous increase in the price of aviation fuel and the economic climate.”

The airline’s operating costs had gone up by $50 million in 2007, the statement added.

Hugh Boyle, chairman of Zoom Airlines, said in the statement: “We have done everything we can to support the airline and left no stone unturned to secure a re-financing package that would have kept our aircraft flying. Even as late as lunchtime on August 28, we believed we had secured a new investment package to ensure future operations, but the actions of creditors meant we could not continue flying.”

Zoom Airlines, flying between North America and Europe, operated year-round scheduled services to Europe, as well as charter services to South America, Caribbean, and Southern United States destinations with Canadian tour operators.

The carrier began operations with services between Canada and the United Kingdom, Italy and France. Recently, it had opened routes between the United Kingdom and several cities in the United States and Bermuda.

Zoom is the latest of many small international airlines to have hit financial difficulty as a result of the unprecedented rise in the prices of aviation turbine fuel. Other carriers which have already closed shop include trans-Atlantic all-business class carriers Maxjet, Eos Airlines, Silverjet, and the long-haul, low-fare carrier Oasis Hong Kong Airlines.

The International Air Transport Association (IATA), the international industry trade group of airlines headquartered in Montreal, Quebec, Canada, had predicted hardly a month ago that the airline industry worldwide could incur $99 billion in extra fuel costs over the next 12 months.

The IATA also has counted at least two dozen airlines that have landed in bankruptcy in the first 7 months of 2007.

Meanwhile, the sudden closure of Zoom Airlines – which carried about 500,000 passengers a year – left thousands of passengers stranded and they were forced to find alternative arrangements to get home from airports in the United States, Canada and Bermuda.

As for those who have booked to fly Zoom Airlines in the future, some may be able to get their money back through their travel insurance and others could get a refund if they had bought a ticket with a credit card.