Andrew Doyle/MUNICH Max Kingsley-Jones/LONDON

Increasing competition between Europe's low fare airlines has forced two more independent carriers to cease operations.

One-year-old Norwegian scheduled airline Color Air has been shut down by its parent company after failing to show signs of turning around its mounting losses, while the UK's London Luton-based Debonair has suspended operations and appointed an administrator.

Oslo-based Color Air operated scheduled routes within Norway and to London Stansted with three leased Boeing 737-300s on the air operators' certificate of Air Foyle Passenger Airlines. The airline was wound up by owner Color Group just as it was planning to expand its network with the introduction of a fourth aircraft for the winter.

"Color Group is not prepared to absorb further losses," says group president Olav Nils Sunde. "It would no doubt take a very long time before airline operations could conceivably run at a profit." Color Air had been subjected to fierce competition in the Scandinavian market and had an average load factor of just 42% for the last six months. It lost NKr180 million ($22.8 million) during the first half of this year.

Debonair was launched three years ago by flamboyant Italian born entrepreneur Franco Mancassola, operating a small fleet of British Aerospace 146s from London Luton. Despite continuous losses, the airline had expanded its network and fleet to 12 BAe 146s and two Boeing 737-300s. Debonair reported a loss for the first quarter of £2.2 million ($3.6 million), compared to a £1 million loss in the same period last year.

Operations of the publicly quoted airline were suspended at the end of September, following the appointment of administrator Deloitte & Touche, which says that it is seeking ways to secure continued operations and find a buyer.

Subcontracts with key European carriers saw Debonair's operations split between its own Luton-based operations, along with services from Munich and Zurich under wet-lease contracts for Lufthansa and Swissair, respectively. These two, along with Virgin, have been suggested as potential buyers for Debonair. Lufthansa says that it is not interested in the airline, while Swissair declines to comment.

These latest failures come just days after the winding up of London Stansted's AB Airlines, and the launch of another UK low fare airline, KLM uk's buzz.

Source: Flight International