Surprise, Surprise: Airberlin Topbonus Files For Insolvency

Filed Under: Airberlin

A week ago airberlin filed for insolvency, after Etihad withdrew their financial support. Airberlin has a spun off frequent flyer program, and unfortunately that program isn’t in much better shape. As of a few days ago, you can no longer earn or redeem miles with airberlin’s topbonus program. Even their co-brand partners are suspending mileage earning, so that their co-branded credit card no longer awards miles.

I explained in a past post why topbonus is in such bad shape. Generally speaking a spun off frequent flyer program wouldn’t file for insolvency so quickly if they had been run as an independent, for profit company. But as I explained, topbonus is 70% owned by Etihad, and in many ways it was being run solely as a way to allow more foreign ownership of airberlin assets.

Today topbonus has filed for insolvency, as I was expecting. Per their website:

topbonus, the frequent flyer program of airberlin filed for insolvency on Friday, 25th August.

This unfortunate development follows the decision last week by airberlin to file for insolvency.

Given airberlin’s current situation and the consequential impact on the frequent flyer program, topbonus was left with no other option.

The earning and redemption of miles remains suspended; the account access to review your profile and miles balances and your topbonus membership remains valid.

I feel bad for those with topbonus miles. The terms of the program state that they have to provide 18 months notice before terminating the program, but I suspect that them going out of business gets them out of that obligation.

I imagine in the coming days it will no longer be possible to earn or redeem partner airline miles for travel on airberlin. As of a couple of days ago airberlin award availability was removed from American’s website, and I imagine that’s only the beginning.

  1. Since topbonus entity was created solely to circumvent limitation of foreign investment in airberlin, this insolvency was expected. At the end of negotiations whereby nobody would take over AB, topbonus lost its purpose.

    Tough I would questioned the reasons why the lawyers suggested establishing topbonus instead of controlling via loans or bonds…..

  2. @Ben, I have award tickets issued by Topbonus to flight with Iberia. Do you think they will honor the tickets or not ?

  3. @Ben: Now that I lost all my topbonus miles, what frequent flyer program would you recommend for someone living in central europe?

  4. Just on a BA flight on BA ticket stock from LHR to TXL (op’ed by Qatar).

    They would still let me use the BA Gold lounge with AB Platinum ie. 1W Emerald. Alas probably for the last time 🙁

  5. The interesting thing here is that Topbonus is also the primary frequent flier program for Niki, now owned by Etihad, which continues to operate. This means that any Niki customers out there were just left out in the cold.

  6. @Claus: Definitely oneworld and within that American but I’m not sure if I should go there or if I’m better with BA/ IB where I maybe collect more easily with other things because they are european based. Because things like credit cards or some other things of American which I might use in the future I can’t use here in europe, can’t I?

  7. You feel bad for those with topbonus miles? Yeah, such a bummer. Imagine being an employee who lost their job, their livelihood, their benefits, etc. etc, for Airberlin. Perspective.

  8. @Danny
    Did you think of Miles and More program? The member airlines apart from Lufthansa are Adria Airways, Air Dolomiti, Austrian Airlines, Brussels Airlines, Croatia Airlines, Eurowings, Germanwings, LOT Polish Airlines, Luxair, Lufthansa Private Jet, SWISS and – the Star Alliance partners like United (full list of airlines is on Star Alliance website).

  9. “I imagine in the coming days it will no longer be possible to earn or redeem partner airline miles for travel on airberlin.”

    Would “partner airline” earning with include OneWorld carriers such as AA?
    Would AB flights still credit to, say, AAdvantage, and would AA/OW status be recognized by AB?

    (having said that, I also agree with the other comment that chief concerns should be with those who work for AB, their lives, incomes, families, etc.)

  10. Lucky, I guess nothing happens to Air Berlin tickets booked with Avios right ? I have a few tickets booked on Air Berlin for October and December with Avios

  11. @Frank:
    The AB employees are protected by the German gouvernment. They’ll receive 80% of their last salary for 6-12 months (up to 12 depending on complicated circumstances) while they have time to re-orientate. Taxes and some of the other complicated social security payments will be slighty reduced, so their net income will not drop to 80% but stay at something between 85-90% of what they had before. They have the same health insurance as before, even slightly better for them because some special treadments will now be completely free. All their pensions always have been and still are payed for by the gouvernment.
    As long as they use the next 6-12 months to find another job all will be fine for them, and if some of them always wanted to leave for another job or start their own business, they now won some months to do so while almost keeping their former income now payed for by the gouvernment.
    And since lufthansa wants to take over larger parts of airberlin, the majority of them will simply keep their jobs with a new employer. So they are taken care of.
    That is one of the few benefits of living in a country where the gouverment takes away half of your money for taxes and all the stuff mentioned above on top (less from people with lower incomes).

  12. @rajat: tickets will be fine, but no planes flying than….. (just hope somebody takes over the routes and honours your ticket)

  13. Just to clarify: Anyone booked on an award ticket issued by an airline other than AB is not taking any risk in respect of the ticket itself, as the contractual relationship is with the issuing airline. The only risk is that the flight might be cancelled at short notice, which causes inconvenience.

    The other way around, I’m not sure how much longer other airlines are honoring tickets issued be AB, at least those issued before they filed for insolvency.

    Re OW status: I think this a contractual obligation of AB and not Topbonus, since AB is OW member and not Topbonus. I don’t know at what stage they will suspend OW membership. As long as AB is OW member, they (and not Topbonus) have a contractual obligation to credit miles to other OW FFP. As this involves a cash payment, I actually think the miles earned now are actually safer than those earned before AB filed for insolvency. Obligations related to current flights are “new debt”, while those related to flights before filing are “old debt”.

  14. Frank: “You feel bad for those with topbonus miles? Yeah, such a bummer. Imagine being an employee who lost their job, their livelihood, their benefits, etc. etc, for Airberlin. Perspective.”

    Frank, you feel bad for those employees who lost their job? Imagine being a homeless drug addict, or being diagnosed with terminal cancer, or someone who has just lost their child in a car accident. Perspective.

  15. I spent all my topbonus miles on some iTunes gift cards moths ago, just to get the account to zero.

    Seriously, everyone reading about AirBerlin this year knew something was clearly going wrong. Delays, cancellations, a lot of desperate marketing actions.

  16. Today, they sent an interesting update message by email. I quote the most relevant part:

    “Together with the preliminary insolvency administrator we are currently working intensively on ways of reopening miles redemption and crediting of miles. At the same time, we are working on a viable future concept for topbonus.”

    I’m pretty sure the administrator has sanctioned at least this part of the message. Now it means no more and no less than they are working on it. But a court appointed administrator would not be working on it, if there was no chance to make it happen ….

  17. I flew AB in May 2017…San Francisco to Florence….WHAT A NIGHTMARE! Many changes to itinerary, had to spend the night in Dusseldorf, put on another airline from Dusseldorf to Frankfurt, then to Frankfurt to Florence–two days late to catch up with my tour group. I did take out trip insurance and am trying to file for trip delay since 5/22/17. I’ve used their online form, email address and telephoned customer service—-no one could/would assist me. I contacted Travelex and they “may” accept the claim if I document with emails (approx. 85)….they also cheated me on my TopBonus air miles….I planned to never fly AB again and was going to donate my miles to a charity….guess they took the option(s) out of my hands.

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