Canberra-based regional airline Brindabella Airlines is in receivership, following the grounding of eight of its 10 aircrafts earlier this year because of tardy safety checks.
Receivers and managers David Winterbottom and Sebastian Hams from KordaMentha were appointed on Sunday.
The move puts up to 140 jobs in jeopardy and impacts the plans of many flyers to regional New South Wales over the holiday period.
The Civil Aviation Safety Authority grounded four of the airline’s planes in November when it determined engine checks had not been completed on time.
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While two of those planes were allowed back in the air, another six were grounded by CASA late last week.
The airline had been running up to 250 flights per week until the recent CASA action.
Following the CASA directive, Brindabella announced on Sunday it had made the decision to cease all passenger flights and ground all aircraft.
Winterbottom said in a statement the company was no longer accepting bookings and flights had been suspended indefinitely.
“Given the approaching Christmas and New Year period, we will be working very hard to minimise the inconvenience to customers and importantly, enable alternative travel options,” he says.
Winterbottom said Qantas has commenced operating extra services on some of Brindabella’s routes.
The receivers have also entered into discussions with the NSW government and regulatory authorities about sourcing other replacement services.
KordaMentha are currently calling for expressions of interest for the business, however the business will not operate while the sale process is taking place.
The company was first founded in 1994 and operated flights from Canberra, Sydney and Brisbane to regional destinations such as Newcastle, Cobar, Coffs Harbour, Moree, Mudgee, Narrabri, Orange and Tamworth.
Winterbottom says it’s too early to predict the future of the company, but it had been negatively impacted upon by the competitive nature of the airline industry, regulatory and maintenance issues and financial pressures.
Last year, two Australian airlines were placed in administration. Western Australian charter airline Alligator Airways collapsed after CASA upheld a grounding order against it because of safety concerns.
In February 2012, Air Australia collapsed after it ran out of cash, leaving thousands of people stranded and 300 people out of work.