Wizz Air will close its base at publicly-owned Cardiff Airport, hitting holiday plans for thousands of travellers.
The budget carrier will stop its two winter routes to Milan and Bucharest on 25 January - and all further planned operations from the Welsh national airport have been scrapped.
It is a big blow for the airport owned by the Labour-run Welsh Government, and comes just eight months after Wizz Air opened the Cardiff base.
At the time of the launch the Hungarian airline said it would offer nine routes including Tenerife, Lanzarote and Corfu and would create 40 jobs directly.
Staff employed at the Cardiff base will be offered redeployment elsewhere, it has been announced.
Wizz Air said affected customers could have either a 120% refund in airline credit, a 100% cash refund or another flight from one of its other bases.
More than 103,000 passengers flew with the airline from Cardiff over the last nine months to a range of European holiday destinations.
The closure also means mean that no airline has a year-round base at Welsh Government-owned Cardiff Airport which has suffered decades of losses despite receiving over £200 million of funding from the Welsh taxpayer.
Cardiff is the second UK base closure in 12 months for Wizz Air, with Doncaster Sheffield closing last year, something which was deemed as a major contributing factor to the airport closing.
In a statement Cardiff Airport said: “We are deeply disappointed to hear that Wizz Air has decided to cease their operations at Cardiff Airport. It is regrettable that Wizz Air has cited the economic climate as its reasons for withdrawing its operations out of Cardiff.
"There has been positive booking trends and very strong passenger demand to travel from Cardiff in 2022 and current booking trends for 2023 remains similar.
"We have been working closely with the airline since 2020 and their latest indications to us last week, were that bookings for this summer are ahead of this time last year, so we see their decision as surprising.
"Our thoughts are with our customers who are impacted by this news and now face disruption to their travel plans for this year, along with our friends and colleagues that are employed by Wizz Air based at Cardiff."
The spokesperson said that four other airlines - TUI, Vueling, Ryanair and KLM - are still flying into and out of Cardiff Airport.
"We encourage those customers who had booked on Wizz this year, to consider an alternative choice to fly to their chosen destinations from Cardiff with (the other airlines)," they continued.
"We will continue our conversations with other airlines and partners to encourage that they offer more choice to fly from Cardiff at cost effective prices for our customers."
The Welsh government described the move as "surprising".
In a statement, Wizz Air UK’s managing director Marion Geoffroy said: “The challenging macro-economic environment and high operational costs including fuel mean that unfortunately, we are unable to continue operating from Cardiff airport.
“We sincerely apologise to our customers in Wales and the southwest of England for the disruption and inconvenience that this will cause.
“Our priority now is to ensure that all affected customers are contacted directly with clear advice on their options and to look after our Cardiff-based colleagues and crew.
“Wizz Air continues to offer low fares from eight other UK airports, including Bristol, Birmingham, London Gatwick, and London Luton."
