While aviation has always been a risky business due to the high-cost entry point, 2024 has seen a particularly large number of airlines go under.
Air Malta, Armenia's FlyArna, and the LIAT airline serving Antigua and Barbuda are some of the global airlines that have filed for bankruptcy since the start of January, while Canada’s Lynx Air and Canada JetLines were among the North American ones. At the start of October, Spirit Airlines (SAVE) stock fell dramatically amid a report that its leadership was exploring bankruptcy as a potential option but jumped back up again when a refinancing deal was reached.
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The latest airline to toe the line of bankruptcy is the Egyptian low-cost and charter airline flyEgypt. On Oct. 21, the airline announced that it was filing for bankruptcy and canceled all flights out of Cairo International Airport (CAI) and Sharm El Sheikh International Airport (SSH).
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A regulator blocked flyEgypt’s attempt to liquidate (here is why)
Citing a lack of funds, the airline also attempted to begin the liquidation but was thwarted by the local regulator, Egyptian Civil Aviation Authority (ECAA), before a strategy for repaying debts was put to paper. This includes contracts with both local Egyptian creditors and travel companies in Germany and Italy that were sending the airline tourists.
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While flyEgypt has not commented on the situation, FlightAware and FlightRadar24 data show that the airline is not running any of the flights it had originally slated for this time in October. (There has also been no comment on how or whether those who had booked flights will be refunded.)
The airline had a fleet of one Boeing 737-800 (BA) on lease after not continuing the leases for other aircraft. Those planes needed repairs the company could not afford; its last registered flight took place on Sept. 20 between Saudi Arabia’s Jeddah and the Egyptian capital of Cairo.
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A short history of flyEgypt: Launched in 2015 as Middle Eastern shuttle
Launched in 2015 out of Cairo, flyEgypt never expanded enough to start running longer flights for tourists coming out of Europe but would often be chosen by visitors from Middle Eastern countries as well as tourists on a wider tour of the region.
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Some of the destinations flyEgypt serviced included the United Arab Emirates, Saudi Arabia, Armenia, and Uzbekistan, while at its peak in 2022, it was leasing nine narrow-body jets. These included seven Boeing 737-800s and two Boeing 737-700s; the airline eventually lost all but one by not renewing their leasing agreements as they expired.
As the airline is a private company backed by Egyptian venture capital group Talaat Moustafa Group, few details around the state of its debts and what ultimately led to its inability to reach profit have been made public. While liquidation would allow the airline to repay some of its obligations, ECAA has said that settlement details must be worked out before proceeding.
“Aside from leasing dues, the ECAA said FlyEgypt has debts to, among others, tour operators in Germany and Italy,” reads a report by Swiss news outlet ch-aviation. “Locally, it owes Egypt’s National Air Navigation Services Company, various Egyptian airports, and its employee social security back payments.”
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