Yes, the transports could have retreated one sea zone space and go back to SZ 112. Units remain loaded in the sea. At this point, you’d have to hope that you built more ships and or 3 fighters and or tac. bombers would be on the airbase at w. Germany and enough to save your troops.
Note, if during the sea battle, your ships could soak up 3 hits (2 for battleships + 1 for cruiser), and the defender rolled 5 hits. Then 2 hits would have had to apply to transports which would bring their cargo to the bottom of the channel. The rest of the transports could then retreat.
