A new online travel agency has launched which aims to offer budget holidays to customers cutting back during the credit crunch.

Travel technology veteran Lawrence Woodhams, who founded Click With Technology, has teamed up with Maz Darvich of Affiliate Future to launch SqueezeHolidays.com.

It will initially be selling winter sun and cities accommodation only and adding flight only in the next few months. The site will also sell package holidays using Freedom Travel Group’s ATOL.

Woodhams said he was confident the company would turn over £12m in its first year, despite the tough economic conditions.

He told TravelWeekly.co.uk: “People still need a holiday. The level of bookings won’t be down, but the value will be. We will be able to offer very competitive prices as after the downturn in July and August, suppliers will be keen to provide good offers to online travel agents who can drive volumes.“