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Image source, Flybe

More from Steve Hindley at The Great South West business and economics group.

He says there must be a drive to re-establish the regional airline routes now lost with Flybe's collapse, before the relevant airport slots are handed over to international routes.

"If you are down in Cornwall and you need to get to London for a business meeting, the best way to do it is to fly," he tells Radio Five Live's Wake up to Money programme.

"It is absolutely essential for business."

He said businesses across Cornwall and Devon in places such as Truro, Plymouth and Exter depended on regional air routes.

"We really need to find out how we can find a sustainable model for these routes in the UK," he said.

Image source, Getty Images

Flybe ran into difficulties last year and was bought by a consortium which includes Virgin Atlantic. In January, the new owners said they would pump £30m into the business to keep it afloat, but appealed to the government for additional support.

A Virgin Atlantic spokesperson, said that it was "deeply disappointed that Flybe has been unable to secure a viable basis for its continuing operations and has therefore entered administration."

They added that over the past 14 months the consortium had invested more than £135m to keep the airline flying for an extra year.

"Sadly, despite the efforts of all involved to turn the airline around, not least the people of Flybe, the impact of Covid-19 on Flybe’s trading means that the consortium can no longer commit to continued financial support," they said.

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Image source, Empics

A year ago, Flybe was bought for £2.2m by a consortium including Virgin Atlantic and Stobart Group.

But the owners “were strange bedfellows,” John Strickland, aviation analyst from JLS Consulting told Wake Up To Money.

“We had two airlines with very different business models. Virgin was interested in Flybe to feed more passengers into its long haul flights into its airports at Heathrow and Manchester while Stobart flies regional routes itself.

"Cyrus Capital were venture capitalists looking to make a return on their investments. None of these were compatible with each other, and I'm sure they had different opinions over time."

He adds that Virgin will likely want to focus on its own business, given the current industry-wide drop off in bookings.

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Image source, Reuters

Steve Hindley is chairman of The Great South West, a group promoting the businesses and economy of the the south west of England.

He told Radio Five Live's Wake up to Money programme the demise of the airline was a "a great sadness" and would have an adverse affect on his local economy, and to others in the UK

"It is a great link for business," he said, adding that although the current government was promising to improve road and rail access to the region, that was still some years away.

"Connectivity by air is essential to the south west region. [Flybe's collapse] really does give an impetus to the regional levelling up agenda of this government."

Image source, Getty

Asian stock markets have risen after US shares rallied as investors welcome measures by world governments, central banks and international bodies to help to protect the global economy from the impact of the coronavirus outbreak.

Japan's benchmark Nikkei 225 gained 1%, the Hang Seng in Hong Kong was 1.9% higher and China's Shanghai Composite was up by 1.9%.

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Image source, Getty Images

More from airline expert Johgn Strickland of JLS Consulting.

He tells Radio Five Live's Wake up to Money that the airline was constricted in what it could do to ease its financial position.

Mr Stickland said raising prices looked "an easy solution on paper" but was not viable in reality because many regional centres of the UK that the airline served could not afford higher fares.

He also said there was a constant pressure on Flybe to be competitive with rail and road travel.

And finally he said there was the drag of a large chunk of Flybe's monies from ticket sales went to the Treasury in the form of air passenger duty.

Image source, Flybe

Flybe boss Mark Anderson has expressed his regret that the firm has been forced to enter administration with immediate effect.

He said Europe’s largest independent regional airline had been unable to overcome significant funding challenges to its business. This has been compounded by the outbreak of coronavirus which in the last few days has resulted in a significant impact on demand.

Mr Anderson said: “The UK has lost one of its greatest regional assets. Flybe has been a key part of the UK aviation industry for four decades, connecting regional communities, people and businesses across the entire nation.

“I thank all our partners and the communities we have been privileged to serve. Above all I would like to thank the Flybe team for their incredible commitment and dedication.”

All flights operated by Flybe have been cancelled with immediate effect.

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Image source, PA Media

Coronavirus has not only had an affect on Flybe but has also affected the wider airline industry, Louise Dudley of Hermes Investment Management tells Radio Five Live's Wake up to Money.

She said the airline industry had been hit by coronavirus but also had a shock at the start of the year in terms of oil prices.

"Travel is now something that people feel they are able to cut."

Looking at the global affect on wider businesses, she adds: "There is still a lot of fear out there. We are seeing a lot of supply chain disruption from China and Asia generally.

"But we are now seeing demand side hit as well. business being hit with both sides."

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Image source, Getty Images

Airline expert John Strickland of JLS Consulting says that coronavirus was the "last straw" for airline Flybe.

He tells Radio Five Live's Wake up to Money programme: "This has been a more chaotic failure than many we have seen. It has been on-off for many weeks.

"But if there is a chance to save it [Flybe] you don't want to stop ticket sales."

Mr Strickland adds: "We should have a better system... to avoid this kind of chaos."

He also said there had been a "massive fightback" from other airlines to a proposed government rescue for Flybe,

Rival operators felt the plan for a government intervention was "not fair."

Image source, Flybe

Airline Flybe has gone into administration, putting 2,000 jobs at risk after a bid for fresh financial support failed.

The carrier said the impact of the coronavirus outbreak on demand for air travel was partly to blame for its collapse.

Its website now advises customers to "not travel to the airport" unless they have arranged an alternative flight.

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Welcome to another day of Business Live. We will bring you all the latest companies and economics news today.

We will also have reaction to the news that airline Flybe has gone into administration overnight. And we will bring you all the latest news about coronavirus and how it affects global business.