Virus pushes aviation sector into ‘crisis zone’

Airbus is reviewing its 2020 delivery targets, issued barely three weeks ago, as the global spread of coronavirus in recent days through Europe and into the US pushes the aviation industry into crisis mode. Passenger demand plunged sharply at the weekend, forcing carriers around the world to freeze hiring and slash the number of flights. IATA will on Thursday significantly increase its estimate of the hit to global sales as a result of the virus. Just 12 days ago it estimated a near $30b impact, based largely on the reduction in flights to and from China. Current data shows a 2.8% fall in global aircraft capacity so far this year, according to aviation data consultancy, Ascend, against IATA’s expectations late last year for growth of 4.7% in 2020. In that context Airbus will not be alone in reassessing its guidance for this year. Executives from both the aerospace and airline industries said they were monitoring the situation on a daily basis. “We’re in a crisis zone for airlines. The situation has rather dramatically accelerated over this last weekend,” said Brian Pearce, chief economist at IATA. “This is far worse than the Sars episode,” he added. “It’s looking more like the global financial crisis, where airline revenues fell 16% in 2009. We’re not there yet but it will depend on the success of which governments manage to contain this European outbreak.” Story has more details.<br/>