Air Berlin has been in the throes of financial crisis for months, culminating in forced insolvency mid-August.
The airline was bailed out by a £137 million loan from the German government, which has kept planes flying until now.
But after months of uncertainty, the European airline has now revealed all flights will be grounded by the end of the month.
In a letter to employees this week, Air Berlin announced preparations to stop all services by October 28 “at the latest”.
Continuing to fly “according to the current state of things, will no longer be possible”, the correspondence revealed.
Air Berlin’s crisis began when Abu Dhabi-based Etihad, which holds a 29 percent stake in the German company, finally lost patience with the loss-making company and withdrew its funding.
Etihad said it was “extremely disappointing” in lieu of multiple cash injections to keep the company afloat, including £227 million as recently as April.
Lufthansa and easyJet are in talks with Air Berlin to buy up parts of the company.
As negotiations continue, many customers with flights booked beyond October 28 are facing cancellations.
Those customers who booked after August 15 when Air Berlin filed for insolvency will be entitled to full refunds or rebooking on an alternative flight.
According to EU legislation, passengers will also be compensated for additional expenses incurred as a result of the cancellations.
But those customers who booked Air Berlin flights prior to August 15 will not get their money back from the airline.
It’s a similar situation faced by Monarch passengers who had flights cancelled as a result of the UK airline’s collapse.
Monarch ceased trading earlier this month, less than two months after Air Berlin filed bankruptcy.
Just a few months prior in May, Italian airline Alitalia also became insolvent.
The British Airline Pilots Association (BALPA) has called for an investigation into the BALPA general secretary Brian Strutton said: “There is a lot of understandable anger which, on the basis of recent reports, does seem to have some justification.
“There are hundreds of thousands of Monarch customers who want to know what happened and why they were still being sold flights on October 1 when the company Board had already decided it was going into administration.”
Published at Wed, 11 Oct 2017 08:30:00 +0000