Blue Islands takes off with £10m loan

Monday 06 July 2020

The government has agreed to pump £10m into Blue Islands to help the island maintain its connections to UK regional airports - but links to Europe could also be on the agenda in future.

Alongside the loan, which will be repaid over six years, the airline has agreed to a 'base carrier deal' with Ports of Jersey, which will see it move its base to Jersey.

The Treasury Minister had previously hinted that financial help to Blue Islands could take the form of a convertible loan - meaning that the government can be paid back through shares in the business in return for their cash injection.

The government declined to provide the terms of the loan when asked by Express.

In a statement announcing the decision to lend Blue Islands £10m, the Government of Jersey highlighted that, with the aviation sector struggling globally, governments have been called upon for last resort financial support - including BA and EasyJet, who received loans of £600m and £300m respectively.

It added that the move was in line with the government's priorities to protect the island's economy, while also supporting islanders' health and wellbeing.

Throughout lockdown, the airline has been providing the 'lifeline' links to Southampton and Gatwick, as well as a number of medical flights.

Pictured: Blue Islands provided lifeline flights to Southampton and Gatwick.

In the wake of Flybe's collapse, the airline had also scooped up a number of key regional routes, but has been unable to fly these due to travel restrictions. However, borders finally reopened to commercial travel on Friday.

Blue Islands CEO Rob Veron commented: “Our focus is now to deliver sustainable, high-frequency, year-round regional services for many years to come. We recognise the important strategic role we need to play, as the Island’s locally based regional airline, in Jersey’s recovery plans.”

He continued: “We understand that there exists much demand for regional services as restrictions are lifted. In a recent survey of over 4,000 of our passengers, more than two thirds said that they intended to travel within three months of flights restarting and over 50% of those initial trips would be to visit friends and family."

Treasury Minister Deputy Susie Pinel said the loan may open up possibilities for direct travel to new destinations: “This financial support will ensure resilience for our connectivity, maintaining access to essential medical care, education and connections with friends and family. This loan will also offer opportunities to develop more direct routes into European countries, and it provides an alternative to the larger airlines, for whom Jersey is a small operation."

Pictured: Rob Veron, Blue Islands CEO.

Commenting on the new "partnership" and potential to "develop connectivity into Europe", Ports of Jersey CEO Matt Thomas said that his team "look forward to working together to achieve this ambition".

Economic Development Minister Senator Lyndon Farnham said that air connectivity has a "major role to play in the recovery of Jersey's economy", adding: "It is critical that an island with a well-established tourism and hospitality industry, and a mature financial services sector, can maintain reliable air links with the UK and the rest of the world."