Direct Air in trouble d

[MAH4546]

Warning for those with Direct Air flights: the airline has been inexplicably canceling flights today and is not giving reasons. This probably isn't good.


http://www.buffalonews.com/city/communities/niagara-falls/article760283.ece

 

[DisneyAndRedSox]

Subscribing for any updates... I have 2 friends flying out of Worcester very soon to Sanford!

 

[pigletto]

Oh goodie. We have flights in 6 weeks, and again in August out of Niagara.
I was aware of the risks of a low cost carrier but all signs and reports were positive and they were adding many flights, not cancelling any.

Nothing to do but remain calm and make a back up plan.

 

[Gina-Gina-Bo-Bina]

Count me in as another Diser who is watching and waiting for more info. I *finally* convinced by boss (in his 70's) to fly to Myrtle Beach rather than drive (which has been his norm for 15 years), and booked him tickets on DirectAir from Niagara Falls for the end of March, returning the first week of April. Now this .

 

[MAH4546]

All flights have been cancelled. Direct Air is still not saying anything, but operations have been suspended.

Direct Air itself is not an airline - it uses other airlines like Vision Air and SkyKing to operate the flights it sells. From the early looks of it, seems Direct Air can't afford to pay for fuel anymore.

 

[Gina-Gina-Bo-Bina]

All flights have been cancelled. Direct Air is still not saying anything, but operations have been suspended.

Direct Air itself is not an airline - it uses other airlines like Vision Air and SkyKing to operate the flights it sells. From the early looks of it, seems Direct Air can't afford to pay for fuel anymore.

So.....what happens to the money people have paid them?

This is a first for me, so I have no idea. Are consumers who have already booked flights simply out of luck? Do they have any recourse?

 

[MAH4546]

So.....what happens to the money people have paid them?

This is a first for me, so I have no idea. Are consumers who have already booked flights simply out of luck? Do they have any recourse?

If the airline goes bankrupt, out of luck unless booked with a credit (not debit) card and still within the chargeback period, in which case the credit card company eats the charge.

The reason being that if Direct Air files for bankruptcy, then passengers holding tickets become creditors. But they are low on the priority list, and by the time Higher creditors get their share, there's nothing left.

 

[dancin Disney style]

So.....what happens to the money people have paid them?

This is a first for me, so I have no idea. Are consumers who have already booked flights simply out of luck? Do they have any recourse?

In Canada, we will have some protection from our credit card companies at least. How much ????

I nearly booked our June/July trip with them 2 weeks ago when they had the $79 sale. Thankfully, the car rental was over $500 so that made the savings only about $150 which I just didn't feel was worth the risk. Previously, I had read several things about this carrier that really scared me off.....and having gone through the Jetsgo thing in YYZ years ago the odds of me booking on a bargain carrier were pretty slim. This trip is for my DD to compete at US nationals so we are not in a position to have issues getting there.

 

[Gina-Gina-Bo-Bina]

In Canada, we will have some protection from our credit card companies at least. How much ????

I nearly booked our June/July trip with them 2 weeks ago when they had the $79 sale. Thankfully, the car rental was over $500 so that made the savings only about $150 which I just didn't feel was worth the risk. Previously, I had read several things about this carrier that really scared me off.....and having gone through the Jetsgo thing in YYZ years ago the odds of me booking on a bargain carrier were pretty slim. This trip is for my DD to compete at US nationals so we are not in a position to have issues getting there.

If the airline goes bankrupt, out of luck unless booked with a credit (not debit) card and still within the chargeback period, in which case the credit card company eats the charge.

The reason being that if Direct Air files for bankruptcy, then passengers holding tickets become creditors. But they are low on the priority list, and by the time Higher creditors get their share, there's nothing left.

Thank you both. Not the news we wanted, but what we expected.....so now we will know to start with the credit card company and see where that takes us.

dancin Disney style.....we, too, almost booked via DirectAir for our August trip. DH wasn't comfortable with the idea, said it sounded "too good to be true" with such crazy low rates. After being super happy with JetBlue for our New Years trip, he said it was worth the higher price to him to rebook with a carrier we loved at a price that seemed more reasonable. He is patting himself on the back this morning as we speak.

 

[magicandwishes]

So.....what happens to the money people have paid them?

This is a first for me, so I have no idea. Are consumers who have already booked flights simply out of luck? Do they have any recourse?

If they booked through an Ontario, Canada travel Agent they will get their money back through the emergency travel fund provided through the gov. It covers airline bankruptcy but only for clients who booked through a travel agency. Otherwise then yes, I think the are out the money

 

[Lewisc]

If the airline goes bankrupt, out of luck unless booked with a credit (not debit) card and still within the chargeback period, in which case the credit card company eats the charge.

The credit card companies don't always wind up having to eat the charge. The credit card companies will sometimes delay paying the airline or hold back money. One case the credit card companies weren't going to pay the airline until after the passenger flew. I don't remember which LCC but they wound up going out of business.

Directair is a public charter. I'd be shocked if they get 100% of the fare immediately after you pay.

edited to add. From their website:

All payments are payable and/or deposited to a charter escrow account at Valley National Bank, 1455 Valley Road, 3rd Floor, Wayne, New Jersey 07470, Direct Air’s depository bank. Your payments are protected by a surety bond issued by Platte River Insurance Company of Wisconsin (the “Securer”). Unless you file a claim with Direct Air, of if DA is unavailable, with the Securer, within 60 days of completion of the charter (or, in the case of cancellation, the intended date of your scheduled return Charter), the Securer will be released from all liability to you under the security agreement. If there is no return flight in your itinerary, completion means the date or intended date of departure of the last flight in your itinerary. All transactions between the Customer and Direct Air shall be solely in United States Dollars; Direct Air is not responsible for any fluctuations in foreign currency exchange rates.

If everything works as it should all passengers should be able to get a refund, assuming Directair goes out of business. Most passengers will probably just get a refund through their credit card and others may need to file a claim with the bonding company.

One of the news articles said all flights were cancelled due to a fueling issue. Maybe the fares charged aren't enough to cover costs including fuel.

 

[MAH4546]

The credit card companies don't always wind up having to eat the charge. The credit card companies will sometimes delay paying the airline or hold back money. One case the credit card companies weren't going to pay the airline until after the passenger flew. I don't remember which LCC but they wound up going out of business.

Directair is a public charter. I'd be shocked if they get 100% of the fare immediately after you pay.

It doesn't. As a charter, the money is held in escrow until the flight operates. But bankruptcy law still applies if it files for bankruptcy, and the passengers become creditors far down the list.

 

[Gina-Gina-Bo-Bina]

If they booked through an Ontario, Canada travel Agent they will get their money back through the emergency travel fund provided through the gov. It covers airline bankruptcy but only for clients who booked through a travel agency. Otherwise then yes, I think the are out the money

Tickets were booked direct with the airline.......drat!!!!!

 

[pigletto]

I do have travel insurance from my bank, but it doesn't look like it covers this. Just delay AFTER departing for travel for emergency reasons.

So what you are saying is I *might* be able to dispute these charges through Mastercard? If anyone could tell me how to go about that when the time comes I'll try.
Again, not going to kick and scream about it. In the end, I knew there was reasonable risk as with anything.. it was looking good and I did my research with those that had flown out of Niagara. Also, they were adding multiple flights and announcing it with big glowing articles in the local papers. But in the end, I'll peruse whatever reasonable options I can.. and put a smile on my face.

Far worse things can happen (this is my mantra today so that I keep my cool)

 

[Gina-Gina-Bo-Bina]

IBut in the end, I'll peruse whatever reasonable options I can.. and put a smile on my face.

Far worse things can happen (this is my mantra today so that I keep my cool)

I can only imagine how upset you must be. I mean, I am upset about my boss's ONE return ticket (he is travelling alone) for ONE trip. I cannot imagine your connundrum with not one, but TWO family trips affected.

I wish you the best of luck in getting things favourably worked out. Do keep us posted.

 

[Lewisc]

It doesn't. As a charter, the money is held in escrow until the flight operates. But bankruptcy law still applies if it files for bankruptcy, and the passengers become creditors far down the list.

I already edited my post to include a quote from Directair regarding escrow.

I have no idea how the funds held in escrow are treated during bankruptcy. I'm sure the credit card companies will argue for a return of the money.

 

[pigletto]

Gina thank you so much.

My dd just got a note from a classmate on Facebook. He is stuck with no way home right now because of this.

We can still drive down, and while that isn't the most fun.. heck we're going to Disney. It's not like we can easily eat this cost, but we're healthy and happy. All else is secondary.

I truly hope this doesn't ruin any trips for families who may have no other options or were taking their first trips. That would be a shame.

 

[Disney Addicted]

Ugh! I hope it all works out for you.

I was excited about their $79 fares as well. If the flights went through the end of September, our family & my friend's family would have booked our tickets with them as well.

 

[webworm]

Their website is probably still taking bookings as well because there is absolutely no message on there and no comment from the company.
http://www.buffalonews.com/city/communities/niagara-falls/article760283.ece
http://www.huffingtonpost.com/2012/03/13/direct-air-south-carolina_n_1341285.html

 

[pigletto]

THAT concerns me webworm. The August flights I booked were last week too.
I would hate to see people still booking today.
I hope someone is able to read this thread and be spared the inconvenience of booking today.

I mean even if they aren't going under (which seems unlikely), it's bad form to leave that site open for booking. Apparently they erased all the angry messages off their Facebook page from last night too. I can see going under, but it's just rotten to not allow informed decisions by erasing warnings.