The Sydney Morning Herald
Posted: 21 February 2020
‘A very tough year’: Virus set to deal $45b blow to airlines, lead to first traffic drop since 2009
The airline industry expects the first annual decline in global passenger demand in 11 years, after tallying up the initial impact of the thousands of flights cancelled because of the coronavirus outbreak in China.
The estimate shaves about 4.7 percentage points off of a passenger-traffic forecast issued just two months ago, with almost all of the impact in the Asia-Pacific region, according to the International Air Transport Association. That may be conservative. The projections assume…
“Even as we see the number of new reported cases of coronavirus in China fall each day, airlines will continue to count the cost of the coronavirus outbreak for some time yet,” Alexander Sehmer, director of geopolitical intelligence at consultant Assynt, said in an email. “For now, people and companies are extremely wary of the potential risks of travelling. Therefore, tourism and corporate travel – with events even being cancelled outside of China – will not pick up in the short term.”
Beyond aviation, the virus has disrupted supply chains of the world’s largest carmakers and hit sales at companies from Apple to Burberry and Nike. Apple this week said it doesn’t expect to meet its revenue outlook this quarter.