Many Australians have been left stranded at airports across the country after budget airline Bonza “temporarily” suspended all flights today.
The company entered voluntary administration within hours of the cancellations.
Here’s what we know so far.
First up, what is Bonza?
Bonza Aviation was set up as a budget regional airline and its first flight took off in January 2023.
The airline aimed to target the regional routes that weren’t serviced by the larger carriers like Virgin, Qantas or, more recently, Rex Airlines.
For example, with Bonza you were able to fly from the Sunshine Coast to Mildura without having to stop in a capital city.
Who owns Bonza?
The airline was the brainchild of Tim Jordan, who held senior commercial roles with Virgin Australia. He was the chief executive of Bonza.
Back in 2023, Mr Jordan he said the airline would lead to cheaper ticket prices due to greater competition.
“I think in any industry anywhere in the world, additional competition is positive for downward pressure,” he said at the time.
The airline has the backing of a US investment firm called 777 Partners.
Based in Miami, the firm describes itself as “investment platform that helps bold entrepreneurs transform visions into enduring value”.
Among other things the firm owns an “ultra-low cost” airline in Canada called Flair Airlines and a minority stake in the Melbourne Victory A-League team.
What’s happening with the Bonza flight cancellations?
Customers arrived at airports across Australia to learn their flights had been cancelled.
Mr Jordan released a two-line statement just after 8am saying all services would be temporarily halted:
“Bonza has temporarily suspended services due to be operated today (Tuesday 30th April), as discussions are currently underway regarding the ongoing viability of the business.
“We apologise to our customers who are impacted by this and we’re working as quickly as possible to determine a way forward that ensures there is ongoing competition in the Australian domestic aviation market.”
Basically, Mr Jordan said he was in talks about whether the business can continue.
But within hours a notice was filed to the Australian Securities and Investments Commission (ASIC) stating that the company had entered voluntary administration.
This means there is an opportunity for the director or a third party to rescue Bonza, or for the company to be restructured. The airline is yet to provide any update.
Have the cancellations come out of nowhere?
It’s not the first time the airline has cancelled flights. Roughly 1,600 customers were left in the lurch when its Darwin-Gold Coast flights were cancelled in December.
That cancellation was extended to March this year, flights were cancelled out of Mount Isa and the airline has been facing ongoing questions about the timeliness of its arrivals.
Aviation expert Keith Tonkin said analysts felt it was difficult for the airline to make a profit.
He says that’s because routes it took “had relatively thin margins” — but he says it’s not impossible to break into a market dominated by Qantas and Virgin Airlines.
“Where there’s a will there is a way,” Mr Tonkin says.
“But Bonza’s model has seemingly proven to be difficult to sustain.”
Aviation analyst Geoffrey Thomas, the editor-in-chief of the website Airline Ratings, said he understood the airline’s backers, 777 partners, had made changes to the leasing and financing of its aircraft.
He said the budget carrier may have been caught off guard.
777 Partners has been contacted for comment.
“I think that the problem of Bonza is overseas, with leasing companies, and not the local management, not the business model,” Mr Thomas said.
Has the government said anything?
Federal Transport Minister Catherine King says she’s looking into it. She says she’s spoken to the chief executives of Qantas and Virgin.
“Both airlines stand ready to assist stranded passengers needing to get home,” Ms King says.
The Transport Department has established a hotline for stranded passengers – 1800 069 244 – that will be operating until 10pm on Monday.
Ms King says she expects Bonza to deal with its customers in a transparent fashion.
“My department has reached out to Bonza and our expectation is that they keep passengers informed of their options and their consumer rights,” she says.
Can I get a refund from Bonza?
Affected customers received text messages today directing them to fill in an online form, which states:
“We will be issuing you a refund for this flight and, if you no longer wish to travel on them, any other flights on the same booking reference as this cancelled flight.
“To allow us to process your refund as quickly as we can, please fill in the details below within the next 24 hours and note the form may close for responses after that time.
“Once you have completed the form, you can expect the refund to appear in your account within 21 days. The refund will be paid to the payment method you used at the time of making the booking.
“Sorry again for the inconvenience and we hope to welcome you onboard a Bonza flight in the future.”
Customers whose flights have been cancelled in the past say they have had difficulty getting refunds from Bonza.
But the Australian Competition and Consumer Commission (ACCC) has protections in place for airline customers.
According to the ACCC, a travel service provider must give the option of a refund if it can’t provide a replacement service for a cancelled flight in a reasonable amount of time.
If you booked a now-cancelled Bonza flight using a credit or debit card online, you may be able to have that transaction reversed through your bank or financial institution, but it’s unlikely to be a speedy process.
The Transport Department’s hotline is focusing on helping stranded Bonza customers book Qantas, Virgin, or Jetstar flights.
The airlines have offered passengers stranded mid-journey complimentary seats, where available, on flights to the airport nearest to their final planned Bonza destination.
Bonza has not responded to requests for comment.
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