The airline industry is reeling from the collapse of Scottish carrier Globespan last night, having failed in its last ditch attempt at a massive bailout package.

Up to 4,000 people are estimated to be stranded abroad following the grounding of all planes operated by Flyglobespan, with some 3,400 not covered by insurance under the ATOL programme.  Some 5,000 passengers were expected to use the airline services over the next few days and as many as 90,000 future reservations may not be covered. Customers who have booked package holidays through the group or paid via credit card should be entitled to a refund but those who have booked direct or paid be debit card may not be so lucky.

Some 800 employees are preparing for redundancy as PWC holds meetings across Edinburgh, Manchester and Glasgow. Rescue missions are rapidly being coordinated across Europe in an attempt to help hundreds of stranded passengers, with Ryanair announcing that they will offer Prestwick and Edinburgh Airports a series of rescue packages.

Globespan went into administration late yesterday and shares in the budget carrier have been suspended. The handling of Scotland’s largest airline collapse will be undertaken by Price Waterhouse Coopers. Passengers are urged to visit the Flyglobespan website which has been updated with relevant travel information. Those concerned about future reservations should contact the Civil Aviation Authority.

The latest setback for the travel industry throws further disarray into the already chaotic travel schedule this Christmas, with British Airways and Eurostar staff all voting in favour of widespread walkouts.