Failure of Caribbean specialist raises APD fears

Caribbean-specialist Rion Travel, which ceased trading at the end of last week, was the third long-haul tour operator to fail since the New Year.

Rion Travel traded as Caribbean Vacations and Barbados Vacations from offices in London’s Regent Street, Manchester and Glasgow. It sold tailor-made package holidays under Atol protection to 28 Caribbean islands, flying with British Airways and Virgin Atlantic.

The Civil Aviation Authority was due to clarify the number of holidaymakers affected on Monday. The company’s collapse follows those of Grus Travel PTY, a Leeds-based specialist in escorted tours to Australia and New Zealand on January 14, and Oriental Panorama of Leicester – a specialist to Malaysia – on January 12. Oriental Panorama traded as Simply Far East, Simply Malaysia and Simply Vietnam.

The failures will heighten fears of a damaging downturn in long-haul travel following a sharp rise in rates of air passenger duty (APD) in November. Travel industry analyst GfK Ascent has reported long-haul sales for summer 2011 down 9% on this time last year despite a 4% rise in total holiday sales. Caribbean destinations are particularly fearful of the impact of APD since air passengers to the region pay a higher rate of tax than to Florida – a direct competitor.

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