MANX2.COM announced in June that it was stopping its service to East Midlands Airport from July.

The company said it was due to the "current mismatch between capacity and demand on Isle of Man routes."

All passengers who were booked to travel were re-booked onto another Manx2.com service or given a full refund.

Chairman Noel Hayes said: "This decline has been partly caused by reduced transfer traffic following easyJet's complete withdrawal from East Midlands Airport - also bad weather and ash disruptions, and significantly now, the impact of more seats flooding on to Isle of Man market at a time when passenger numbers are already down.

"The simple equation is that 17,000 fewer people have traveled to the Isle of Man in the first four months of 2010 but the market has been flooded with 120,000 extra seats on an annual basis so load factors are sharply down.

"At Manx2 we need to ensure we maintain a strong and healthy route network so whereas we would normally preserve a loss making route through a bad patch the amount of overcapacity coming into the Island means we have had to cut the route to ensure the rest of our network remains healthy.

"The Isle of Man's route network is being largely determined by Flybe and easyJet and what they want to do. This produces short term consumer benefit in lower prices but long term instability and pain as capacity is inevitably cut back again.

"With significant cuts expected to impact on the UK economy this year the current mismatch between capacity and demand on Isle of Man routes is not sustainable. Hence, Manx2.com's decision to expand into Wales and Ireland thereby reducing its dependence on an oversupplied market."

The East Midlands route started in March 2008. Since the start of 2010 passenger numbers were down 25 percent year on year with April 2010 down 30 percent.