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Monarch Airlines Bankruptcy Strands Thousands Of Travelers

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The ongoing price war and stiff competition in the European aviation sector has claimed another victim. The UK's Monarch Airlines has decided to cease operations with immediate effect, becoming the country's largest ever airline to enter administration.

The decision leaves about 110,000 customers of the airline stranded overseas, while about 300,000 future bookings were also canceled.

The UK's Civil Aviation Authority or CAA said in a statement on Monday that all future Monarch bookings, including flights and holidays, have now been canceled. This follows a decision by the board of Monarch Airlines to appoint joint administrators, which has resulted in the airline ceasing to trade.

The CAA added that the UK Government has asked it to charter more than 30 aircraft to bring back to the UK about 110,000 Monarch Airlines customers who are currently overseas, at no cost to them.

Meanwhile, Monarch customers in the UK who are yet to travel abroad have been advised not to go to the airport as there will be no more Monarch flights.

"We are putting together, at very short notice and for a period of two weeks, what is effectively one of the UK's largest airlines to manage this task. The scale and challenge of this operation means that some disruption is inevitable," Andrew Haines, chief executive of the CAA said.

Blair Nimmo, Partner at KPMG and Joint Administrator to Monarch Airlines, said, "Mounting cost pressures and increasingly competitive market conditions in the European short-haul market have contributed to the Monarch Group experiencing a sustained period of trading losses. This has resulted in Management appointing us as administrators in the early hours of this morning."

Stiff competition in the airlines sector has put pressure on weaker carriers in Europe. Air Berlin PLC (AIBEF.PK), Germany's second largest carrier, filed for bankruptcy in mid-August this year as its businesses deteriorated at a rapid pace.

Italy's troubled flagship airline Alitalia also filed for insolvency in May this year.

by RTT Staff Writer

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