AER Lingus Regional operator Stobart Air has been left reeling from the impact of the coronavirus and the collapse of Flybe, telling staff it needs to slash costs in order to survive.
While the carrier has seen a fall in bookings, it also had two Embraer jets and two ATR turboprops leased to UK-based Flybe, meaning it has now lost hundreds of thousands of euro a month in revenue from the contract.
Failed Flybe was part of the Connect Airways group of which includes Stobart Air. Dublin-based Stobart Air operates the Aer Lingus Regional service on a franchise basis.
It's a key part of the larger airline's operation, driving traffic from UK regional airports to Dublin, which Aer Lingus uses as a hub for its transatlantic services.
Stobart Air boss Andy Jolly has written to staff urgently requesting some to volunteer for unpaid leave or to accept reduced hours. It has also suspended recruitment and frozen pay rises.
Less than two weeks ago, Stobart Air launched a captain training programme, recruiting first officers to meet "growing demand" on the airline's network. The company employs more than 500 people.
"The coronavirus epidemic is impacting consumer purchasing habits and we are seeing reduced demand on some services," said a Stobart Air spokesperson. "As a result, we have reduced the number of flights operated by Stobart Air in the coming weeks and months."
Prior to the collapse of Flybe, Stobart Air was operating more than 1,000 flights a week on 38 routes.
It was providing some franchised flying for Flybe, but the bulk of its business is the Aer Lingus Regional operation.
The spread of the coronavirus is having a severe impact across the airline industry.
"As a consequence of the reduced commercial programme, and until we have full clarity on the impact of current developments on the aviation industry and our business, we have offered more flexible working options to our team, while we will temporarily suspend our recruitment plans," added the Stobart Air spokesperson.
Mr Jolly told Stobart Air staff that the carrier has been "seriously impacted" by the downturn in traffic because of Covid-19 and the failure of Flybe.
"The blunt reality is that we are only going to survive this period of transition if we can significantly reduce our cost base in the interim," he warned.
Aer Lingus declined to comment yesterday on Stobart Air's difficulties. Meanwhile, Aer Lingus has ceased taking bookings to northern Italy.