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THE future of STA Travel is under threat after as its parent company plans to file for administration.
The student travel company has become the latest company to fall victim to the Coronavirus downturn.
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It has almost 2,000 employees working in over 200 stores worldwide.
It is unclear what that means for 52 UK branches, although the company said some operations around the world will continue.
A spokesperson for STA Travel Holdings said they were trying to clarify what will happen to the companies UK operations.
STA Travel has an Atol licence to carry just over 34,000 passengers. This means holidays which have been booked together are protected.
The company blamed the coronavirus pandemic, stating that it had “brought the travel industry to a standstill”.
What does this mean for my holiday?
THERE are protections in place if you have booked a holiday with STA travel and are worried about your money.
Things are slightly more complicated by the fact STA’s parent company doesn’t yet know how filing for insolvency will impact the UK arm of the business.
That said there are protections in place if you have a holiday booked with STA.
- Anyone who has buys a package holiday is covered by the Air Travel Organiser’s Licence scheme (Atol) which guarantees you will get your money back. STA is Atol protected and you should have received a certificate when you booked.
- However while ATOL protection may mean you get a refund for your flight and/or package holiday, it won’t cover you if you booked you flight or accommodation separately.
- If you paid for a hotel or flights on your credit card then you can claim a refund using Section 75 of the Consumer Credit Act 1974.
- This law states that if the company you bought from goes bust, or they don’t deliver on the product or service they sold you, you’re entitled to a refund as long as you spent between £100 and £30,000.
- If you paid on a debit card you may be able to claim the money back as a chargeback refund. Chargeback means if you don’t receive the goods you bought, you may be able to get your money back but it’s up to your individual bank.
- If you have paid a deposit and still have upcoming payments on a holiday it is best to keep paying as a failure to stump up the cash could result in you losing out on a refund in the long term. Deposits paid on a credit card are protected.
STA parent company, Switzerland-based Diethelm Keller Group, said the company has not been immune from the “global magnitude of the pandemic”.
In a statement the company said: “Over recent months, the company took decisive measures to secure the business beyond coronavirus.
“However, sales have not picked up as anticipated, due to consumer uncertainties, further restrictions and renewed lock-down measures, which are expected to largely continue into 2021.”
STA travel said: “Following the decision to place STA Holdings, the parent company of STA Travel, into administration each division’s Country Manager and leadership team is now reviewing its own position.
“Further information will be confirmed as soon as this is finalised.”
STA Travel Holding AG will appoint an external administrator in the next few days to take over and determine next steps.
“STA Travel Holding AG very much regrets to not have been able to secure the future of the business under these unprecedented circumstances,” the firm said.
Globally, the travel and aviation industry is feeling the financial hit following months of lockdown and cancelled flights and holidays.
Job losses since June 2020
MANY firms have announced job cuts since June as a result of the coronavirus lockdown. These include:
- Shoe chain Aldo collapsed into administration with five stores permanently closed
- Victoria’s Secret plunged into administration, putting 800 jobs at risk
- Fashion chain Quiz put its shop business into administration in , putting 82 stores at risk
- British Gas owners cuts 5,000 jobs, over half of which will be in management
- Airbus announces 1,700 job losses. It expects cuts to be made by summer 2021
- TM Lewin says it will close all 66 of its UK shops, putting 600 jobs at risk
- Harveys Furniture goes into administration resulting in 240 immdiate job losses and puts another 1,000 at risk
- Upper Crust plans to make 5,000 out of its 9,000-strong workforce redundant
- EasyJet says it plans to close hubs at Stansted, Southend and Newcastle, putting 4,500 jobs at risk
- John Lewis is reported to be planning to cut jobs and permanently close department stores
- Harrods has said it is consulting on cutting 680 jobs
- Virgin Money, which owns Clydesdale and Yorkshire Bank, will cut 300 jobs
- Topshop owner Arcadia has announced plans to cut 500 office staff
- Royal Mail is expected to cut 2,000 jobs as a result of coronavirus
It is expected that nearly three million British travel and tourism jobs are on the verge of disappearing — while the economy is close to losing £142billion from the travel sector.
British Airways are slashing up to 12,000 jobs from its 42,000-strong workforce due to a collapse in flight numbers.
At the start of the month Hays travel announced 878 employees out of 4,500 could lose their jobs.
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