A warning has been issued to customers of budget airline Bonza after it was placed under voluntary administration.
Travelers remained stranded at airports across Australia on Tuesday morning, amid urgent talks over the airline’s future.
Financial analyst Evan Lucas said customers may find it difficult to receive refunds for canceled flights, despite the airline’s assurances that they would give them their money back.
“In terms of getting your money back, it is unfortunately unlikely that it was put into voluntary receivership as of 4:30 yesterday afternoon,” he said on Sunrise on Wednesday morning.
Yesterday the airline claimed that refunds would be processed within 21 days.
“The refund will be paid via the payment method you used when making the booking,” the statement said.
Mr Lucas said Bonza’s attempt to challenge Australia’s three major airlines ended in failure
Mr Lucas said Bonza’s attempt to challenge Australia’s three major airlines ended in failure, mirroring the fate of previous airlines that had tried to compete with these industry giants.
“The fourth carrier has always been a problem in this country,” he explained.
‘We have Virgin, Qantas and Rex. Every time we get a fourth, there isn’t enough [demand].’
He said Bonza wanted to compete with the big players by flying to destinations such as Rockhampton and Port Macquarie.
‘That was good, but it is not sustainable.’
He said the company has not paid the leases for their Boeing 737 Max 8 aircraft, which have since been seized.
“Yesterday was because they didn’t pay the leases for the planes,” he said.
“If you don’t pay the bills, you can’t run your business.”
Mr Lucas said it is important that Aussies understand that although the company is based in Australia, it is “an American airline with American issues around its financing.”
Evan Lucas said customers are unlikely to receive refunds after it goes into receivership
The company has appointed external administrators Hall Chadwick, who say the measure will ‘enable an independent insolvency practitioner to take control of the company’, during which creditors’ claims will be stayed.
Transport Minister Catherine King said a hotline had been set up for affected passengers, but admitted the chances of Bonza resuming operations were slim.
‘We spoke to the administrators last night, they are trying to get the airline back up and running, I think they need to take a good look at the books. “It’s unlikely that will happen,” she told ABC TV.
“Airplanes will be canceled at least until May 2, and then customers will have to go to the Bonza website or the administrators to find out what the next steps are.”
Bonza chief executive Tim Jordan apologized to customers and said the company’s continued viability was being discussed.
“We are working as quickly as possible to determine a path forward that ensures there is continued competition in the Australian domestic aviation market,” he said.
The Sunshine Coast-based company was unveiled in October 2021, with the first flight taking off in January 2023.
It operates Boeing 737-Max-8 aircraft and is backed by 777 Partners, an investment group based in Miami, Florida.
It originally flew 27 routes to 17 destinations, but began cutting services during its first six months.
Earlier in April, Australian newspaper Financial Review reported that consultancy firm KordaMentha had been brought in to help the company, which Bonza denied.
Bonza’s LinkedIn profile says it has between 51 and 200 employees.
The airline operates flights from selected airports on the east coast of Australia, but does not have flights to or from Sydney and Brisbane.
It flies to many regional destinations including Albury, Mildura, Mount Isa, Tamworth and Port Macquarie.