Passengers of collapsed discount airline Zoom seek new flights
Last Updated: Friday, August 29, 2008 | 10:08 AM ET
CBC News
Thousands of travellers were trying to book other flights Friday after the sudden collapse of Ottawa-based Zoom Airlines left them with useless tickets.
A Zoom plane sits on the tarmac at the Calgary International Airport. (Louise Moquin/CBC) The discount carrier abruptly shut down and began bankruptcy proceedings on Thursday, leaving planeloads of passengers stranded in Canada and Britain.
Zoom said the rising costs of fuel and a weakened economy over the past year forced it to ground its planes.
Dozens of passengers at Halifax's Stanfield International Airport who were destined for Ottawa following a flight from London were ordered off a Zoom jet on Thursday.
Some were forced to spend the night at the airport. Workers at the airport tried to make it easier for those passengers by providing them with mattresses.
Another flight to Paris from Calgary was cancelled Thursday night, and in Vancouver, hundreds were stranded when four British-bound flights were grounded.
Travel agent advised against ticket purchase
A Toronto woman who had been planning to fly to Trinidad in September said when she spoke to her travel agent in June, he told her not to buy Zoom tickets because they were not looking "financially stable."
Amanda James-Lakhan had never flown with the airline before and said she's glad she listened to the advice.
"Now I understand the value of a trusted travel agent versus buying online," she said.
Zoom, founded in 2001, had been struggling to cover its debt and pay airport fees. The transatlantic carrier had a staff of 450 in Canada and 260 in Britain.
The airline owes more than $400,000 to the authority that runs the Calgary airport, along with money to the airplanes' owner, ground support and refuellers.
The Halifax airport authority is owed nearly $200,000 by Zoom for unpaid landing fees, gate fees and other expenses.
Airline faced 'brutal' fuel prices, tough competition
Ian Lee, director of the Sprott School of Business at Carleton University, said Zoom's demise isn't surprising, as recent economic conditions have hit small, regional airlines the hardest.
"They just don't have the economies of scale. They don't have the capital, the deep pockets, to sustain these brutal fuel prices," he said.
Lee said Zoom didn't have routes running to the same destinations at the same time every week, making it difficult to pick up business customers in the competitive trans-Atlantic market.
Lee added it's not surprising that passengers were kept in the dark for so long.
"If there's even a hint of trouble even if it's not completely warranted, people will abandon it [the airline] overnight and it becomes a self-fulfilling prophecy. And so generally in these kinds of situations, they try to keep the airline going, the company going until all avenues have been exhausted, and I think they ran out of time," he said.
In all, about 4,500 Zoom customers were stranded abroad, most of them at airports in Belfast, Glasgow, Gatwick, Cardiff and Manchester.
The Civil Aviation Authority, the U.K.'s aviation regulator, has warned that only those who had booked their flights as part of a package deal were guaranteed a flight home without having to buy another ticket.
An official with the regulator was quoted by London's Times Online as saying, "If you book direct, you're on your own."
Customers advised to contact credit card companies
Zoom's U.K. representatives told customers that both British Airways and Virgin Atlantic would offer "special fares" to help them return home. They also advised them to apply for possible refunds through their credit card companies.
British Airways, however, said it had no economy seats available to Gatwick until Monday and on Thursday night remaining tickets were selling out quickly.
Air Canada has also offered stranded passengers on either side of the Atlantic a one-way fare at what spokesman Peter Fitzpatrick said would be a "reasonable cost."
Zoom's demise comes more than three years after Jetsgo, another discount carrier, suddenly ceased operations, stranding 17,000 passengers.
