Cornwall Airport is facing a significant financial blow after the now-defunct Eastern Airways entered administration, leaving the airport owed over £1.5 million. The airline’s collapse has halted vital services, raising concerns about the long-term connectivity and economic impact on the region.
Key Takeaways
- Cornwall Airport is owed £1,566,910.62 by Eastern Airways.
- The airline entered administration in November last year.
- There is a very low likelihood of the airport recovering the owed funds.
The Impact of Eastern Airways’ Collapse
Eastern Airways, which operated daily services between Cornwall Airport Newquay and London Gatwick, entered administration in November of the previous year. This abrupt halt in operations left a void in connectivity, with a replacement carrier only secured later. The airline’s failure has resulted in a substantial debt to Cornwall Airport, with administrators RSM UK Restructuring Advisory indicating that unsecured creditors, who represent over £20 million of the total debt, have ‘nil’ chance of recovering their money.
A Crucial Public Service Obligation Route
The route between Cornwall Airport Newquay and London Gatwick was established under a four-year Public Service Obligation (PSO) agreement. This agreement, a collaboration between the government and Cornwall Council, was designed to ensure consistent, year-round connectivity to a major transport hub, deemed essential for Cornwall’s economy. Financial support for this PSO route was provided by Cornwall Council and the Department for Transport. Currently, the PSO route is being operated by Skybus, an airline belonging to the Isles of Scilly Steamship Group.
Wider Financial Fallout
Companies House has revealed that Eastern Airways owes a total of £28,710,452.33 to 416 creditors. Beyond Cornwall Airport, several other businesses, particularly in the South West, are listed as creditors. These include MRMU (HIE) Ltd T/A Holiday Inn Express in Victoria, St Austell, which is owed £18,176.44, and A2B Taxis (Truro) Ltd, expecting £9,646.23. Exeter Aerospace Limited is also among the affected parties, with a debt of £204,253.26, and Exeter and Devon Airport Ltd is owed £9,863.27. Plymouth-based Courierforce is also noted as being owed £51,231.60.
