Ansett forced down

14 September 2001

MELBOURNE - The Australian government was today considering a plan to bring in military aircraft to rescue 45,000 passengers stranded around the country by the collapse of Ansett.

The airline's administrators suspended all Ansett operations, both domestic and international, claiming a lack of cash or facilities to fund the operation.

Thousands of passengers turned up at Ansett terminals this morning to find the doors locked. Only airport security staff were on hand to placate angry passengers.

The end for Ansett - which has been losing A$1.3 million a day, came quickly following a decision by Air New Zealand this week to place its wholly-owned subsidiary into administration.

Qantas has offered to fly stranded Ansett passengers free of charge when seats are available. Virgin Blue has offered special fares to Ansett ticket-holders.

One person who did get away with military help was New Zealand prime minister Helen Clark, whose Air NZ plane returning to Wellington from Europe was blockaded at Melbourne airport by angry Ansett workers.

A police helicopter took the New Zealand leader to a military airfield from where she was being flown across the Tasman.

The impact of the suspension of Ansett services will have a huge knock-on effect. Some Traveland outlets closed their doors for a time today as administrators set a 72-hour deadline to sell the chain as viable concern. Airport retail outlets, car rental companies and cleaning contractors are also affected.

Airline caterer Gate Gourmet, which provides food for Ansett aircraft sent its workers home yesterday.

Australia's Travel Compensation Fund could also face big claims. Industry sources put the total TCF exposure at between A$15 and A$20 million.

Paul Fleming, managing director of Harvey World Travel, said the impact of Ansett's suspension on the travel industry would be "catastrophic". One Australian government minister said he was "looking forward to going after Air New Zealand" in view of their "unbelievable incompetence".

The Australian Securities and Investment Commission says it will investigate Air New Zealand's role in keeping the financial markets informed about Ansett's problems.

Ansett union bosses have flagged that they will pursue an international union ban on servicing Air NZ flights.

The Australian government has ruled out a financial rescue package for Ansett, claiming it would cost A$170 million just to keep the airline flying over the weekend.

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