This European Airline Filed For Bankruptcy And Passengers Might Not Get A Refund

Almost two years after a post-Covid reckoning caused Air Belgium to cancel its remaining passenger flights, the European Airline is throwing in the towel. The Lufthansa-owned airline was officially deemed bankrupt on April 30, 2025 in a Belgian courtroom. While this bankruptcy will still leave 124 people employed within the airline, 130 employees who made up the cabin crew were let go at the start of 2025. To boot, the 124 jobs saved are a further loss of jobs from the 197 pilots Air Belgium were still employing up until the bankruptcy declaration.

While the company attempted to right the ship using a few different funding strategies, its plan to relaunch full flight operation in March or April 2025 didn't reach the expected fruition. Further putting the nail in the company's coffin is the challenge of reimbursing passengers for purchased flights that bankruptcy concludes won't happen. According to The Street, these non-refunded tickets equate to $9 million in losses, $5 million of which travel agencies and tour operators were forced to absorb. The reimbursement of the rest of the lost flights, however, are still in question. While there are a few companies that have come roaring back from bankruptcy recently, the situation Air Belgium has found itself in currently makes this a near impossibility. Like most bankruptcies, the predicament has been building for some time, with very concrete reasons for this happening now.

According to 2022 data from McKinsey & Company, the global economic impact of Covid-19 on airlines led to the loss of around $167 billion. Although the data shows airlines were losing money before Covid-19 due to factors like competition, high fixed costs competing with unreliable revenue, and a business model susceptible to uncontrollable and unforeseeable factors — like 9/11 or Covid — these represented only a tenth of the losses the pandemic handed them. In 2022, Air Belgium lost $45 million euros, roughly $41.2 million (USD) to fuel, lost revenue, and salaries. However, the company had already faced liquidation as far back as 2018 after a doomed business strategy that had the airline running mostly vacant passenger flights to mainland China from an airport outside of Brussels. The company survived due to sourcing additional capital and restructuring its flight plans and business model. 

In an April 2025 statement from Air Belgium's CEO Niky Terzakis, his remarks allude to the challenges Air Belgium faced over the years. "Since its creation, Air Belgium has had to face a series of challenges, including several years of global crises brought on by COVID-19, the war in Ukraine, and others." The predicament helps prove the legitimacy of McKinsey & Company's data about both the impact of Covid-19 and the effect of preexisting challenges on the airline industry.

CMA CGM, a global shipping and logistics company based in France, announced plans to acquire Air Belgium in April 2025, operating the airline as a separate entity from Brussels and the Liege-Bierset Airport in Brussels. This allowed the airline to continue employing 124 Air Belgium employees, which included 72 pilots. The plan at this point is to sell off whatever CMA CGM doesn't own during the bankruptcy proceedings. As a result of the millions of dollars in lost flights and unreimbursed consumer airline tickets, the European Travel Agents' and Tour Operators' Association (ECTAA) is advocating for more protection from liability in the case of airline insolvency to limit its impact on consumers, travel agencies, and tour operators. In a May 2025 statement, ECTAA President Frank Oostdam said,"The Air Belgium bankruptcy is yet another stark reminder that the current system leaves both consumers and travel intermediaries exposed to unacceptable risks. Airlines must be required to provide financial guarantees to cover their liabilities in case of insolvency."

For Air Belgium's part, they expressed an awareness of the impact of the company's bankrupcty on current customers, but the company's CEO stopped short of an apology as per CH-aviation saying, "This transfer was the only viable option, after all other rescue paths were explored." The company, restructuring under CMA CGM, will focus on freight and cargo carriers instead of passenger flights, bolstering CMA CGM's inventory of freight planes and bolstering its hold on the air cargo industry.