Aviation world braces for worsening virus outbreak

Entire travel sector including aviation is rocked as death toll rises and 2019-nCoV races around the world, infecting thousands, threatening global economy.

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Aviation world braces for worsening virus outbreak

The aviation world is being severely affected by the novel coronavirus (2019-nCoV) that scientists say made the jump from animals to humans in Wuhan, China, with airports around the globe screening passengers for potential carriers and airlines cutting flights to and from China. As of today (29 January), there are upwards of 6,000 people infected with the virus and 132 deaths. Those figures are expected to rise in the coming hours and days.

Cathay Pacific and Hong Kong Airlines said Tuesday the airlines would cut in half the number of flights they operate to China. Cathay, which has the larger exposure of the two airlines to the mainland, said it would progressively reduce its number of flights from 30 January until 31 March. until March 31. At Hong Kong Airlines, the carrier’s previous six times a day  Shanghai Pudong and Hongqiao flights will be cut to twice a day on certain dates. Both airlines have said they would waive rebooking, re-routing and refund charges for affected customers. Hong Kong officials also announced they had cut rail services to the mainland to help contain the spread of the virus.

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In the US, United Airlines said it was cancelling 16 flights starting 1 February between San Francisco and China. The flights are set to resume on 9 February but that could change depending upon the progress of the virus. The cancelled flights include four flights between San Francisco and Hong Kong and 12 flights between San Francisco and Shanghai. United said in a statement that the suspensions are due to “load factors,” i.e. not enough bookings on the flights, and not due to virus fears. The airline will continue to operate thrice-weekly flights to Beijing, Shanghai, and Chengdu from San Francisco.

The virus is also causing some xenophobic reactions as some locales considering barring people from China, especially in the source city of Wuhan, from travelling. Passengers refused to board a plane to China on 28 January after realising people from the city at the centre of the coronavirus outbreak were also booked on the flight — leading to an hours-long standoff, according to reports. More than 70 passengers refused to board the Chinese Southern Airlines plane in Nagoya, Japan, after recognising the accents of 16 fellow travellers meant they came from Wuhan, where the deadly virus originated,  the Asian News Agency reported. The passengers demanded the Wuhan travellers be barred from the flight to Shanghai — but eventually relented once staff from the Chinese consulate in Nagoya stepped in to mediate.

The most recent viral outbreak is bringing strong reminders of the SARS outbreak in Asia during 2002-2003, which brought Hong Kong to a halt and drove down the economy not only there but in other locales as well. During the height of the SARS outbreak in April 2003, aviation passenger demand in Asia fell a dramatic 45 percent, according to the International Air Transport Association (IATA). Cathay cut nearly 40 percent of its flights then, driving it into a financial loss, as did Singapore Airlines, Japan Airlines and ANA Holdings, according to reports.

Airports and other travel facilities are screening for passengers with fevers, but some carriers don’t always exhibit symptoms. (PHOTO: Shutterstock)

For Asia, the risk is even higher now should the outbreak continue or grow worse as the continent is heavily reliant on Chinese travellers who have taken to the skies in the millions thanks to rising incomes. In Australia, Chinese travellers account for more than 15 percent of international arrivals, up from just 4 percent in 2003, according to Moody’s ratings service. Those travellers, who arrive mostly via mainland carriers, often take domestic flights once they arrive in Australia, pointing to the potential for knock on effects for the likes of local airline Qantas Airways Ltd if there is a fall in travel demand, according to a Reuters report. Since 2003, the number of annual air passengers has more than doubled, with China growing to become the world’s largest outbound travel market.

Many airlines, including Korean Air Lines, Singapore Airlines’ budget carrier Scoot, Taiwan’s China Airlines and Japan’s ANA, announced they were cancelling flights in and out of Wuhan after authorities announced a lockdown. South Korean budget carrier T’way Air earlier this week postponed the scheduled launch of a new route to the city.

The new virus poses a “substantial” risk to global air travel and the aerospace sector, an analyst for Canaccord Genuity warned. Ken Herbert, an analyst at financial-services firm Canaccord, said in a research note that although it’s “very early into the current coronavirus outbreak,” several other outbreaks in recent years provide a framework that can be applied to the current situation. The note mentioned that although the current outbreak appears to be spreading faster than those past viruses, it has been less deadly so far. Herbert said an average revenue drop of 13 percent has been observed over past outbreaks, citing data from IATA. “However, we believe that all things considered, traffic tends to recover relatively quickly after a pandemic outbreak,” Herbert said.

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