Oasis Hong Kong Airlines shuts down

9 April, 2008:

Hong Kong-based budget airline Oasis Hong Kong has stopped operations after one-and-a-half years since it started its long-haul budget flights. Oasis Hong Kong Airlines began flying to London in October 2006 and added services to Vancouver in 2007.

Oasis Hong Kong Airline is the fourth airline worldwide to stop flying within two weeks. Three US carriers namely ATA Airlines, Aloha Airgroup and Skybus Airlines, had stopped operations because of surging fuel prices and slowing demand.

Oasis Hong Kong has reportedly applied for liquidation and all of the airline's flights have been canceled. A report quoted Chief Executive Officer Stephen Miller as saying that the “it is with great regret that Oasis Hong Kong announces that today the airline has voluntarily applied to the Hong Kong court to appoint a provisional liquidator”. He added that Oasis Hong Kong has suspended all passenger services with immediate effect.

Loss figures and the reasons for the shut down have not been made public. However, it is being believed by industry observers that the two main reasons for Oasis' financial difficulties possibly could be sky rocketing fuel costs and the competitive environment in Hong Kong. It has been a common belief that Hong Kong was not suited to be called a good hub for budget airlines, as landing fees at the city's airport are high.

Oasis Hong Kong’s provisional liquidator, KPMG says it will try to find new investors for the company. The shutdown has come about even as Oasis Hong Kong Airlines had planned to operate low cost flights to Germany and Australia later in 2008.