All Flybe flights have been grounded after the company entered administration. Credit: Aero Pixels from England.

British airline Flybe has entered administration just two months after the UK Government announced a rescue package.

The Exeter-based carrier collapsed after failing to withstand the impact of the coronavirus (Covid-19), which has significantly affected flight bookings.

As a result of the collapse, all Flybe flights have been grounded and its UK business has terminated all trading with immediate effect. The move also puts around 2,000 jobs at risk.

In a notice on its website, Flybe stated that Alan Hudson, Joanne Robinson, Lucy Winterborne and Simon Edel of EY have been appointed as joint administrators of the company.

The company also advised all travellers not to travel to airports unless they have arranged an alternative flight with another airline. It also informed about its inability to arrange alternative flights.

UK Civil Aviation Authority chief executive Richard Moriarty said: “This is a sad day for UK aviation and we know that Flybe’s decision to stop trading will be very distressing for all of its employees and customers.

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“We urge passengers planning to fly with this airline not to go to the airport as all Flybe flights are cancelled.  For the latest advice, Flybe customers should visit the CAA website or the CAA’s Twitter feed for more information.”

In January, UK Business Secretary Andrea Leadsom announced a rescue deal for the airline following discussions between the management and shareholders.

The deal included a potential loan and deferral of air passenger duty (APD) bill and other taxes.

However, the move was inadequate for Flybe, which was acquired by Connect Airways consortium in February last year.

The company was operating with an annual loss of around £20m before the takeover, reported The Guardian.