Dixons Carphone will close all of its Dixons Travel stores, having made the decision to shut down the business after the government removed airside tax free sales for most retailers.
All 35 stores, found in airports around the UK including at Heathrow and Gatwick, as well as two concessions on P&O Cruises, will close, after pandemic-led restrictions no longer made the business viable.
All 398 impacted employees will be offered roles elsewhere in the company.
A spokesperson for Dixons Carphone said: “Today’s announcement follows an unprecedented year for the travel industry, which has seen UK airline passenger volumes fall by 75 per cent in 2020 due to Covid-19 restrictions.
“This, coupled with our expectation that passenger numbers will not recover sufficiently to compensate for the removal of the tax-free shopping concession by the UK Government from 1 January, means Dixons Travel, which makes up just 1 per cent of our UK&I selling space, has become unsustainably loss-making.
“We are, therefore, proposing to close our Dixons Travel business. We’re confident we’ll be able to offer any of the affected colleagues who want to stay another role elsewhere in Dixons Carphone. We’re grateful to our colleagues for their continued commitment and will support them through the process.”
The electronics retailer also plans to close Carphone Warehouse stores in the Republic of Ireland.
Elsewhere, strong online growth has led Dixons Carphone to reimburse the government £73m for the Covid support it received via the furlough scheme.
Group electronic sales more than doubled to over £4.5bn for the year, as lockdown restrictions prompted consumers to shop online.