Flight Centre to shut 40% of its stores, kills its cruise brand

Business Insider SA
cruise ship
Flight Centre has closed its cruising brand Cruiseabout due to fallout of the Covid-19 crisis. (Photo by Nick Karvounis on Unsplash)
  • Australian-owned Flight Centre will close 40% of its stores, as well as its cruise-ship brand Cruiseabout.
  • The company says it is dealing with “unimaginable circumstances” amid the coronavirus crisis.
  • On Tuesday, airline operator Comair – which operates kulula and British Airways in SA – announced that it had entered business rescue. 
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Flight Centre, South Africa’s largest travel company, will close 40% of its stores as the coronavirus crisis wreaks havoc on its business.

All travel and flights have come to a standstill as countries across the world lock down their citizens to stem the spread of coronavirus.

“While we deal with these unimaginable circumstances, we - and other businesses - are taking some very difficult decisions,” Andrew Stark, managing director of Flight Centre Travel Group in the Middle East and Africa, told its clients in a letter.

On Tuesday, airline Comair – which operates kulula and British Airways in SA – announced that it had entered business rescue. The company suffered a R564 million loss in the first six months of its financial year.

Flight Centre says it will retain only 60 stores, and will also close its Cruiseabout brand, with its customers and bookings to be transferred to the rest of the business.

The cruise industry is expected to be hit hard by the fallout from Covid-19, following multiple outbreaks of the virus on ships this year.

Stark says the company wants to grow its online business “exponentially” over the coming years.

With an annual turnover of R5.5 billion, Flight Centre has various local businesses, including in corporate travel, holiday travel, student flights and cruising.

The company currently has more than 1,200 employees. Flight Centre did not want to confirm how many employees will be affected by the store closures.

“Our decisions are geared towards guiding us through this period of hibernation for the travel industry while preserving as many jobs as possible for the long-term and ensuring we are well placed to service your needs when the inevitable recovery begins,” Stark said.

The first Flight Centre outlet was opened in 1994 at the Westgate Mall in Johannesburg. The company is owned by the Australian company Flight Centre Travel Group, which is listed on the Australian Stock Exchange. Flight Centre closed 100 of its outlets in Australia in March.

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