Birmingham-based Sun4u ceased trading this morning, prompting fears more travel firms could collapse as the lates market falters.


Sun4u was a victim, Travel Weekly understands, of the ash cloud crisis in April and May and failure of Turkey specialist Goldtrail Holidays but more importantly sustained poor trading.


The 40 staff at the retailer’s call centre were told this morning of the collapse, which is expected to leave Barclaycard and the Civil Aviation Authority picking up most of the bill. The cost to the Air Travel Trust fund that backs the CAA’s Atol scheme is expected to be around £500,000.


A source close to the collapse said: “It’s miserable out there at the moment, there just aren’t the bookings around. The back two weeks of August are looking pretty lousy. You’d normally expect collapses from September when the cash starts drying up, but this is still mid-August.”


Sun4u had an Atol and a bond with the CAA worth around £300,000 although this is expected to be insufficient to cover all its licensable business.


It had a turnover of around £20 million, approximately 50,000 customers a year and a myriad of trading names including OnTheCaseHolidays.co.uk, FlyBeachSun.co.uk, Bonusbreakaways.com and Golden Sun4U.com.


It was described as a typical split contracting retailer specialising in Spain and highly reliant on Teletext for generating business.


Sun4u had two directors, Tina Patel, the managing director, and Leigh Erickson, who was the finance director. It has previously operated an office in Swindon and opened a retail outlet on the high street in a coffee shop in March last year but this was forced to close.


Administrators Antony Batty have been appointed and the company is expected to be put quickly into liquidation with Barclays Bank being the main creditor.