The shock announcement that STA Travel was filing for insolvency late last week was followed with confirmation that the 41-year-old travel business had gone into voluntary administration.
London headquartered STA Travel Holding AG had filed for insolvency last week, after making the decision that the global business could not continue to trade in light of COVID-19 and the financial impact the company had already suffered.
In a statement, the company explained that despite the decisive measures to secure the business beyond the pandemic, sales had not picked up as anticipated.
“The global magnitude of the pandemic crisis has brought the travel industry to a standstill,”
“We have left no stone unturned and took decisive measures trying to secure the business beyond the pandemic crisis. We very much regret to not have been able to secure the future of the business.”
Casper Urhammer, CEO STA Travel
It is indeed, the end of an era.
Started by two Aussie student backpackers in 1979, STA originally stood for Student Travel Australia before the brand soon spread around the world.
In 2020, the company reported having almost ‘2,200 people working in over 200 stores around the globe, helping over 2 million travellers a year start their adventure.’
STA Travel currently has 27 stores in Australia and 11 stores in New Zealand which have now closed their doors.
It’s estimated around 180 staff in Australia will lose their jobs following the company’ collapse.
What about people who had trips booked? Will they get their money back?
In a story on nine.com.au, numerous customers in Australia say they had already been left significantly out of pocket with many attempting to have their trips refunded to no avail in recent months since the pandemic began.
On a customer announcement FAQ page on STA Travel’s website, a Deloitte spokesperson said:
“Customer deposits, for example, are in many cases not held in Australia, and third party companies overseas are also involved. This is a challenging situation, and the Administrators are investigating possible options (if any) available to customers to allow them to recover any prepaid bookings or continue their travel plans.”
“Given all Australian STA Travel stores and its call centre were closed prior to our appointment and its website is down, access to STA personnel is not possible. In the interim, customers holding bookings should contact their airline, hotel or tour operator regarding the status of their bookings. You can also consider contacting your credit card provider if travel bookings were paid by credit card.”
“Due to the current circumstances, we are not currently in a position to offer any cash refunds for cancelled trips. Customers holding bookings should contact their airline, hotel or travel operator regarding the status of those bookings. You can also consider contacting your credit card provider if travel bookings were paid by credit card.”
Deloitte spokesperson, Administrators
For bookings made in the UK however, the majority of holidays flight-inclusive packages sold by STA Travel are protected by the CAA’s ATOL scheme, as well as scheduled airline tickets under its IATA licence and as an agent for the airline.
STA Travel Limited also sold some packages which did not include flights and were protected by ABTA as well as holidays as an agent for other tour operators. Meaning, customers will likely get all their money back.
After 41 years, STA Travel’s closure is yet another kick in the guts for the travel industry due to COVID-19. Our thoughts go out to everyone affected by the news.
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