Airline collapse leaves thousands stranded

The collapse of the budget carrier Air Australia has stranded hundreds of the airline's passengers overseas and left thousands more with little prospect of taking flights they have paid for.

According to some reports, the domestic and international airline is believed to have sold about 100,000 tickets for future flights that are unlikely to ever take off.

Internationally, Air Australia flew to Hawaii, Bali and Thailand and had domestic routes from Melbourne, Brisbane and Perth.

Most of the airline's 300 staff have been stood down as about 4000 passengers are left to search for alternative flights.

Administrator Mark Korda told Australian news group ABC: "Air Australia was unable to purchase fuel in Phuket to refuel the planes. They owed the supplier of fuel money, and needed to buy fuel, so the supplier would not supply fuel.

"The directors had a meeting at 1.30 this morning and appointed us as administrators due to the solvency of the company. '¨

"Our focus at the moment is just dealing with the passengers overseas. So we have talked to Qantas, Virgin and Jetstar. But we are encouraging all people overseas to make alternative arrangements. '¨

"Hopefully we can find a white knight. If not the operations will stay suspended and then what we'll do is we'll follow up with everybody about how did this all happen."

The administrator said people who had paid by credit card or have travel insurance are highly likely to get refunds but those who paid in cash may have lost their money as the airline had no cash for refunds.

With permission from Travelmole