Star comment: Only best airlines will take flight
And so the UK’s last independent charter airline has bitten the dust.
The collapse of Monarch is nothing short of disastrous – particularly for the tens of thousands of stranded passengers that will need to be brought home in the coming days.
Then there is the the 750,000 people who have future bookings with the carrier, all of whom have been left counting the cost of the company’s failings.
Once the dust has settled, it will be time to examine the reasons why Monarch has gone into administration and look at what lessons can be learned.
There is little doubt that the airline found itself in a very weak financial position.
Another reason is the rise of low cost airlines, which has led to the gradual decline in popularity of charter flying.
The firm’s chief executive, Andrew Swaffield, says terror attacks in Egypt and Tunisia and the collapse in demand for flights to Turkey have also played a role.
While all of these factors undoubtedly took their toll on Monarch, the real story is simply one of supply exceeding demand.
For years now there has been too much capacity in the short-haul aviation market in Europe.
This goes some way to explaining why Monarch is the third major European airline to go under this year alone.
In May Alitalia filed for bankruptcy and is currently in the process of being auctioned off.
Then Air Berlin, Germany’s second-largest carrier, announced its long-haul services will come to an end later this month after it became insolvent in August.
Monarch is the latest, but it is unlikely to be the last.
All of the remaining firms are left with a huge challenge to keep their heads above water.
Ryanair has responded by trying to keep fares at ultra-low levels by running very tight schedules, which, in recent weeks, has resulted in scores of flight cancellations.
The death of Monarch should act as a warning sign to the rest.
In 2015 it was a profitable airline, but this year it chalked up losses of £60 million.
In this increasingly cut-throat market, the reality is that only the best-managed and most adaptable airlines will survive.
