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Airlines may suffer $100b loss

By Kong Wenzheng | China Daily Global | Updated: 2020-03-12 09:33
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A worker cleans near check-in counters for international flights are seen empty due to the coronavirus outbreak at Don Mueang Airport in Bangkok, Thailand, March 11, 2020. [Photo/Agencies]

Travel restrictions

US technology giants Amazon, Google and Salesforce have all restricted unnecessary cross-border travel. Switzerland's Nestle and France's L'Oreal also have advised employees to postpone travel for a few weeks.

IBM decided to halt all domestic travel for internal meetings and all external events with over 1,000 attendees until the end of March. Microsoft, Google and Facebook have canceled spring industry conferences, all of which draw thousands of attendees annually.

South by Southwest, the annual music, film and technology and conference that attracted more than 400,000 people from 106 countries to Austin, Texas, last year, was canceled this year for the first time in its 32-year history.

The GBTA's survey indicated that 86 percent of its supplier companies saw the coronavirus having a significant or moderate impact on their revenues, with airlines and hospitality providers taking the biggest hit.

The association expects the outbreak to cost the industry $821 billion in 2020.

The coronavirus "is fundamentally affecting the way many companies are now doing business" and is significantly impacting the business travel industry's bottom line," said Scott Solombrino, GBTA's chief operating officer and executive director.

"As the virus continues to spread across the world, business travel is slowing at an alarming rate. The impact to the business travel industry-and to the broader economy-cannot be underestimated," he said.

The IATA estimated a 19 percent drop in worldwide passenger revenues in the industry once the outbreak reaches a global scale. Some of the most affected markets, including East Asia, Western Europe and the Middle East, are losing more than 20 percent of their passengers, while Canada and the United States are facing a 10 percent decrease, said the association.

"Many airlines are cutting capacity and taking emergency measures to reduce costs," said de Juniac, calling the current situation as "a crisis".

US-based JetBlue said it is cutting capacity by 5 percent in the near term. German airline Lufthansa said it would cancel 7,100 flights in Europe, reducing 25 percent of its capacity.

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