Air Vanuatu liquidation confirmed, travellers stranded

Vanuatu's national carrier has been placed into voluntary liquidation by the government, it has been confirmed.  

Travellers to the Pacific nation on Air Vanuatu - many of whom are Kiwis - are currently stranded as international flights have been canned for the rest of the week.  

Morgan Kelly, Justin Walsh and Andrew Hanson of the accounting firm Ernst & Young Australia (EY) have been appointed as voluntary liquidators of the airline, the Vanuatu Daily Post reported. A statement by EY on Thursday cited a "challenging period for the global aviation industry, including labour shortages, inflation affecting input costs and a global increasing cost of credit environment".

The liquidators also noted the impact of cyclones on tourist activity.  

As per the Daily Post, the liquidators took control of the business on Thursday. The fleet has been grounded to allow for safety and maintenance checks before normal operations can resume.

EY said affected travellers will be rebooked on flights once operations have resumed and the firm is working with the airline's existing management team.  

"Air Vanuatu is critical to the people of the Republic of Vanuatu and a strategically important business to the nation," EY partner in strategy and transactions Morgan Kelly said.

"Our team is working closely with management to ensure continuity of service to customers and to ensure services continue as seamlessly as possible.

"The outlook for the airline is positive, despite pressures on the broader industry, and we will be focused on securing the future of this strategically vital national carrier."

Liquidators intend to resume normal trading "as soon as possible", while considering "all opportunities to place the carrier on a stronger footing", the statement said.

While Virgin Australia continues to operate flights between Brisbane and Vanuatu, no other airline travels between New Zealand and the archipelago.   

Air New Zealand general manager domestic, Jeremy O'Brien, told Stuff the airline would not be able to bring Kiwi travellers home, citing ongoing issues with the supply chain and increased engine maintenance.    

One stranded traveller, who wished to remain anonymous, told the outlet resorts in Vanuatu are attempting to work together to charter a flight to Brisbane. He also said some people are running low on medications that are not available on the island.  

The chair of the Air Vanuatu board, Alain Lew, also announced the board no longer exists.

On Thursday, it was revealed the Oceania Football Club (OFC) Men's National Cup has been moved to Fiji amid the flight cancellations.

"Uncertainty around Air Vanuatu's flight schedules has forced OFC to move Group B fixtures in next month's OFC Men's Nations Cup 2024 from Luganville on the island of Santo in Vanuatu, to Fiji's capital Suva," the club said in a statement. 

The tournament is scheduled to take place from June 15-30. 

Air Vanuatu is the national carrier of the republic, operating services to destinations across Australia, New Zealand, New Caledonia and the South Pacific with a fleet of six aircraft.

It has codeshare arrangements across regional carriers including Qantas, Fiji Airways and Solomon Airlines.

The first meeting of Air Vanuatu creditors is said to be scheduled shortly.  

Air Vanuatu has not responded to a Thursday request for comment.