How the Coronavirus costs airlines millions amidst flight cancellations and decreasing demand on flights to China
Major airlines have been required to cancel their flights to China as the Asian government has placed Wuhan’s airport on lockdown. The interruption to the scheduled services has affected flights since the start of January.
KLM, Air France, Delta, among others, have all begun letting their passengers cancel flights to the Country free of charge. Airlines that operate flights to Wuhan have announced that they will not operate any services to the city until into mid-March and some American airlines even into April. It is unknown how long the lockdown will last. Airlines such as Finnair, Air Canada, the Lufthansa Group or British Airways have all taken measures to reduce operations to mainland China.
The airline industry is expecting a loss
This year is not looking like it is off to a good start for the airline industry. The International Air Transport Association announced that because fewer people are now wanting to book flights to Wuhan and mainland China, the global airline industry is faced with a financial loss of £23.7bn in revenue. This could mean that for the first time in nearly 10 years, air travel across the world could potentially decrease.
IAG is still to determine whether it is making a loss
One of the leading airline groups in Europe the International Airlines Group, which represents airlines such as British Airways and Iberia, was set to report on its financial outcomes of 2019. According to the media, the outcome will be closely monitored and predictions on any future impacts of the coronavirus will be made.
Air carriers make preparations as reports show an increase in coronavirus cases in northern Italy
As reports of an increase in coronavirus cases in the northern regions of Italy come in, Irish airlines such as Aer Lingus and Ryanair have considered taking appropriate measures in order to prepare for potential coronavirus cases. The Irish airline Aer Lingus stated it was “monitoring the situation and following all guidelines from the relevant authorities in relation to this issue”.
Some flights arriving from destinations affected by the coronavirus were advised that those returning from the affected countries should contact health authorities in Italy for further guidance and support if passengers are worried or concerned.
Temporarily, the country banned public events in certain regions and the Venice Carnival, which is a popular and well known public event celebrating the beginning of Lent, has been suspended.
Air France-KLM group reports millions in loss from flight suspensions
The group announced earlier last week that the flight cancellations would have a ‘brutal’ impact on the entire industry. More specifically, it warned that Air France-KLM was expecting a loss of between 150 to 200 million euros for April’s revenue. Apparently, the airline had made a ‘significantly positive’ increase in January in terms of revenue, which drastically changed with the outbreak of the virus.
However, an airline representative also added that if the virus were to continue to cripple air traffic it would have ‘many scenarios we can look at should this virus continue’.
Hong Kong Airport records the worst passenger numbers for January in five years
According to the South China Morning Post, 5.7 million passengers arrived and departed from the airport in the starting month of this year. That is 11.7 million fewer when compared to last year and marks the worst passenger numbers for January in five years.
Further comments from authorities at the airport described the month of February as a month of ‘continued decline’ as it looks like there will be further restrictions to travellers arriving and departing within China. However, officials at the airport also explained that the reduction in passenger traffic was due to other factors, including protests.
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