With a smaller customer base and less of a financial cushion to fall back on during tough times, many smaller regional airlines have had a particularly challenging time staying afloat in the current market.
British regional carriers Eastern Airways and Blue Channels, Swedish carriers Braathens Aviation and H-Bird, and Icelandic low-cost carrier Play Airlines have all collapsed in high-profile shutdowns over the last year.
Over in the U.S., Spirit Airlines is currently in a second bankruptcy while Texas-based charter airline Starflite Aviation recently had its air operator’s certificate (AOC) stripped by regulators after an FAA audit found evidence that the owners falsified the training records of its pilots.
“A challenging path over the last 15 months”: Nordica delivers last Bombardier plane to buyer
At the start of 2025, Estonian budget airline Nordic Aviation Group and offshoot charter provider Xfly were both declared bankrupt by a local court after racking up more than €85 million in debts.
The airline was founded out of Tallinn in 2015 with grants from the Estonian government and tried to establish itself as a budget airline running flights to nearby Baltic and Nordic capitals as well as more distant European cities such as Amsterdam and Paris.
Related: Another low-cost airline filing for bankruptcy, cancels flights
As the airline continued to operate at a loss and efforts at privatization ultimately fizzled out, the owners filed for bankruptcy in November 2024 and were ordered to liquidate a few months later.
“Nordic Aviation Group and Xfly have gone through a challenging path over the past 15 months since the airline began its turnaround process in August 2023,” Chief Executive Officer Remco Althuis said in a statement in November 2024. “This journey has been marked by immense efforts from the entire team to bring the airline to a new and sustainable footing.”
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Despite government backing, Nordica plans came crashing down
The last commercial flight ran in September 2024 when many travelers with booked trips received emails telling them that the airline was shutting down abruptly.
These airlines filed for bankruptcy in 2025:
- Spirit Airlines (Spirit Aviation Holdings, Inc.): Filed for Chapter 11 bankruptcy for the second time on Aug. 29, 2025.
- Ravn Alaska: Ceased operations in August 2025 after earlier Chapter 11 proceedings; shut down flights and folded into other operations such as New Pacific.
- Corporate Air: Filed for Chapter 11 bankruptcy (restructuring) in September 2025 as part of a planned sale, according to Bondoro.
- Play Airlines: The Reykjavik-based airline shut down operations and entered involuntary bankruptcy in September 2025.
- Braathens Airlines: The airline was forced to file for bankruptcy and canceled all of its flights in September2025.
As is now being reported by Estonian press, the liquidation process is now nearly complete and the last of the airline’s seven 88-seat Bombardier CRJ900NG planes took off from Tallinn Airport (TLL) on March 31 to be delivered to the buyer.
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The owner, airplane leasing company Regional Jet, had filed for bankruptcy in November 2024 alongside Nordica while its fleet was sold to U.S. aircraft and parts distributor Regional One in June 2025.
Related: Airline files for bankruptcy, cancels all flights