BONZA AIRLINE: Hopes of survival begin to fade

At least one of the six parties who had expressed interest in taking Bonza out of administration to ensure its survival has pulled out, and the date when staff, customers and creditors will know more has been extended until May 29.

Administrator meeting with Bonza staff

Hall Chadwick, Bonza’s administrator, told staff on Tuesday (14 May 2024) that the airline’s grounding has been extended until 29 May. Vietjet Air, a potential buyer for the stalled airline, has now pulled out of talks with the administrators.

The administrators have said they are in talks with six serious potential buyers for Bonza and the market it has established on tourist-driven routes between regional centres.

Few assets left

The in-administration airline Bonza has few assets, as the lessor of its aircraft has repossessed them and is flying them offshore, as it did with the 737 MAX 8 ‘Bruce’ last week. The asset that it does have, and that is worth something, is its aircraft operator certificate.

VietJet, no longer interested

The AFR is reporting that VietJet has been exploring opportunities to enter the Australian market other than as a destination. VietJet, which since April flies 48 services a week to Adelaide, Brisbane, Melbourne, Perth and Sydney, has now terminated its involvement in talks with the administrators.

Hall Chadwick has said that it wants to hold a fairly quick sale process if it can. Those interested in purchasing the airline must produce an expression of interest by Thursday of this week (16 May 2024).

2PAXfly Takeout

The dust has yet to settle on Bonza Airlines‘ demise, but it looks like it was the victim of unstable financing through its part-owner, 777 Partners. Ayesha de Kretser of the AFR has written a great piece if you want to get into the weeds of the financing shinanigans

In a nutshell, it looks like the Bonza finance cupboard looks pretty much bare, and travellers will need to contact their banks and credit card issuers for any recompense for lost fares.

Industry observers generally agree that Bonza had built a new market for tourist travel between ill-served new regional leisure markets and some capital cities. The consensus also seems to be that, given the right aircraft and more secure financing, their model might have worked and been profitable. Other commentators agree about establishing a new market but think it is too ‘thin’ to ever make such a model profitable.

If a buyer emerges for the bones of Bonza, we may yet get an answer to that question.