Given it already caused a global stock market sell-off, will the novel coronavirus soon threaten the global airline industry?
By: Ringo Bones
The World health Organization has just declared as of March 9, 2020 that the novel coronavirus as a Public Health Emergency of International Concern. About a month ago, a global stock market sell-off now threatens to plunge the global economy into a recession that could be worse than that of 2008. Could the global airline industry suffer the same fate?
Around the time of the 2020 Year of the Rat Lunar New Year festivities, when the Beijing Government declared a public health emergency citing the rapid novel coronavirus spread that started in Wuhan, it didn’t take long when almost a quarter of a million scheduled flights to China were cancelled in order to limit the spread of the coronavirus. Even before the end of February 2020, there were 238,939 flights to China that were cancelled. Easyjet stocks fell by 18-percent and the IATA states that the novel coronavirus could cost the global airline industry by as much as 29.3 billion US dollars. It is not only the airline industry, travel firms are experiencing their biggest fall since the 2008 Global Credit Crunch.
Shares in many American, Asian and European airlines tumble. Carriers have been forced to cut flights due to the coronavirus. Australia’s Qantas says that the novel coronavirus outbreak could cost it by up to 99-million US dollars. If the outbreak doesn’t abate by the middle of 2020, more than half of the world’s airline companies could face bankruptcy due to cancelled flights.
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