Air Australia
Thousands of travelers from Hawaii to Thailand were stranded Friday
after budget airline Air Australia ran out of money and went into voluntary
administration, immediately grounding its five-jet fleet.
The Brisbane-based international and domestic airline, formerly known
as Strategic Airlines, said all flights had been canceled and the airline would
not be accepting new bookings because it could no longer pay its bills.
Voluntary administration in Australia is similar to bankruptcy protection in
the U.S., and can buy a company time to trade out of its financial problems.
"It currently appears that there are no funds available to meet
operational expenses so flights will be suspended immediately," the
airline said in a statement. Passengers who bought tickets with credit cards or
had travel insurance may be given a refund, the airline said.
Around 4,000 passengers were overseas with Air Australia round-trip
tickets, voluntary administrator Mark Korda said. Some of those affected were
stranded in Honolulu and Phuket, Thailand.
"Overnight, the company was unable to refuel its planes in
Phuket," Korda told Australia's Fairfax Radio. "The directors
appointed us at 1:30 this morning and the boys have been working throughout the
night to deal with what's a very difficult situation."
Stranded in Honolulu, Priya Sinh was forced to postpone her 18th
birthday party on Saturday at her home on Australia's Gold Coast. She used her
iPad to log onto Facebook to tell her 70 guests not to come because she
wouldn't be back in time.
"We tried to laugh about it, but it wasn't funny," she said
while her family called hotels looking for a room. Her mother managed to
reserve the last four seats on a Jetstar flight to Sydney leaving Saturday.
Australian airline Qantas and Jetstar, its budget subsidiary, were
considering adding services to help stranded passengers get to their
destinations, Qantas CEO Alan Joyce said. He said the airline will sell
stranded passengers tickets for the same price they paid for their Air
Australia tickets, giving them a chance to recover the full price from their
travel agencies or credit card companies.
Air Australia's fleet consists of five Airbus A330-200 and A320-200
aircraft, and regularly flies to Bali, Phuket, Honolulu and cities within
Australia.
Korda said in a statement
that Air Australia's administrators were calling for immediate expressions of
interest in the sale of the business.
