Start The Adventure Travel (STA Travel), a student travel agency that specialised in affordable holidays and gap year experiences for young people, is the latest business to enter administration following the economic fallout of COVID-19.

The news will be a particular blow to the thousands of customers who had already booked holidays with the now-defunct booking agency prior to the socioeconomic repercussions of the pandemic. According to a recent BBC report, however, customers may still be protected under the company’s ATOL insurance scheme.

Jason Tracy of Deloitte, one of two voluntary administrators overseeing STA Travel’s administration along with colleague Timothy Norman, conceded tough times lie ahead for the recession-stricken company.

“A stressful time”

“We appreciate this will be a stressful time for all involved, and in particular customers and employees,” he said. “We will be communicating with them as soon as possible as we assess and understand the situation, and options going forward.”

Tracy added that an “urgent assessment” of the company’s financial position was needed before talk of any possible restructure or sale could take place.

Whilst news of a declining travel industry is nothing new, niche companies like STA Travel have fared particularly poorly during macro lock-down measures and travel restrictions owing to their tailor-made, package experiences. 

These holidays are now increasingly difficult to organise due to the nature and uncertainty of different countries’ quarantine restrictions.

Cutbacks on intercontinental flights are thought to have rubbed further salt into the wound. Indeed, Australian airline Qantas’ announcement that they would no longer be running intercontinental flights in or out of Australia until the second half of 2021 was a reality STA executives deemed a bridge too far.

“Over recent months, the company took decisive measures to secure the business beyond COVID-19.

“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,” an STA Travel spokesperson said.

Recent aviation data from Statista points to more trouble ahead. Scheduled passenger flights were down 47.5 per cent this month compared to August 2019. These figures are estimated to have cost the aviation industry losses of £240 billion.

In the wake of the administration, the company stated on its website:

“Due to the recent announcement that STA Travel UK has ceased trading, unfortunately our travel experts are unable to assist you at this time.

“Please be assured that if you had a previous booking with us, or hold a live booking, you will receive further communication in the coming days. We are sorry for the inconvenience and the limited information available to you at this time.”

49 years of history

STA Travel was founded in 1971 by two Australian students who both wanted to make long-haul travel more affordable to young people. Following the company’s administration, 500 UK positions could now be at risk.

News of STA Travel’s demise came after its Swiss Parent company Diethelm Keller Holding filed for insolvency late last week.

For the latest updates on administrators handling collapses like this, stay one step ahead and subscribe to Administration List today.