Tuesday, January 18

Rapid Omicron Spread Destroys Budding Air Travel Recovery


Swift and still evolving border restrictions in response to the omicron variant have submerged demand for air travel once again, throwing a long-awaited recovery to uncertainty.

The emerging wave of coronavirus has put airlines under even more pressure as they navigate rules that vary by country and are reviewed daily as more information about the strain comes to light.

Moneyweb Insider Gold

Join heated discussions with the Moneyweb community and get full access to our market indicators and data tools while supporting quality journalism.

R63/month or R630/year

SUBSCRIBE NOW

You can cancel anytime.

Carriers cut 151,000 flights globally through February 1 in the first week the new variant appeared, or 2.9% of the schedule as it stood on November 24, according to data compiled by BloombergNEF.

The data offers an early glimpse of the scale of damage omicron has caused so far. Airlines have made steep cuts for this week, but they have been held back later in the calendar, suggesting there are a greater number of in-store cancellations as the variant is identified in more countries.

Aviation executives targeting recovery less than two weeks ago called for a more consistent response.

“Omicron simply highlights that we are not as coordinated as we should be,” said Jeffrey Goh, CEO of the 26-member Star Alliance, whose members include United Airlines Holdings Inc., Singapore Airlines Ltd. and Air China. Ltd. “International leadership still lacking.”

Researchers and governments are racing to control how deadly omicron is, how easily it spreads, and how resistant it is to current vaccines.

Meanwhile, governments tightened entry rules, banned flights and reintroduced quarantine measures to curb the spread of the variant.

Requirements vary and can change rapidly, making air travel a bewildering proposition for those in a position to consider it. Over the weekend, the UK added a pre-flight test requirement for all inbound travelers, while the US said it is reviewing policies on a daily basis. Japan backtracked on a plan to stop inbound flight bookings.

British Airways called the latest UK measures “completely out of step”, while Deputy Prime Minister Dominic Raab defended what he called a “balanced approach”.

One impediment to travel is the possibility of entry rules changing mid-flight, leaving passengers stuck at their destination and perhaps not even being allowed to return home.

“Inevitably, there will be an immediate short-term setback,” Goh said in an interview last week.

Omicron has reached more than three dozen countries after being first detected in southern Africa. The exact nature of the threat may not be clear for weeks, but governments were quick to impose drastic measures after many were ambushed by the delta variant months ago.

A quarantine worker directs a passenger in an arrivals hall at Incheon International Airport in Incheon, South Korea, on Friday, December 3, 2021. Around the world, the omicron variant continued to spread, including in India, Singapore, South Korea, Greece and Finland. and Ghana.

Asia has been the most affected, where an incipient flight acceleration has been undone. Eastern Europe, where infections are on the rise, has also seen an impact, according to BloombergNEF.

Western Europe and the US have held up better, and even sub-Saharan Africa has escaped the worst impacts, with airlines such as Delta Air Lines Inc. and Virgin Atlantic maintaining flights.

South Korea enacted a 10-day quarantine and is curbing domestic activity, and while Singapore is keeping most of its vaccinated travel lanes open, it has curbed new ones.

Airline stocks have zigzagged for the past two weeks. They ascended to Europe on Monday, after Anthony Fauci, the chief medical adviser to US President Joe Biden, said on Sunday he was encouraged by the first signs that omicron infections weren’t that serious, making it which alleviates concerns about the variant causing the most disruption in the airline industry. next year.

Seasonal travel waves are coming, with the Lunar New Year holidays and the Winter Olympics in Beijing in February, followed by Easter in mid-April and summer in the Northern Hemisphere.

“The pent-up demand will come back, it’s just that there needs to be clarity on what those travel rules and restrictions are,” Goh said, adding that the confusing answer to omicron “doesn’t necessarily bode well for the next variant.”

© 2021 Bloomberg


www.moneyweb.co.za

Leave a Reply

Your email address will not be published. Required fields are marked *