general

The number of international tourist arrivals could plunge by 60 to 80% in 2020 owing to the coronavirus pandemic, the WTO said Thursday, revising its previous forecast sharply lower. Widespread travel restrictions and the closure of airports and national borders to curb the spread of the virus had plunged international tourism into its worst crisis since records began in 1950, the UN agency said. Tourist arrivals fell by 22% in the first three months of the year, and by 57% in March alone, with Asia and Europe suffering the biggest declines, according to the Madrid-based organisation. "The world is facing an unprecedented health and economic crisis. Tourism has been hit hard, with millions of jobs at risk in one of the most labour-intensive sectors of the economy," the body's secretary general, Zurab Pololikashvili, said. Airlines have suffered the most since the outbreak began with most flights grounded, but hotel groups, cruise operators and tour operators are also reeling. Under a best-case scenario, with travel restrictions starting to ease in early July, international tourist arrivals could fall by just 58%.<br/>

As the coronavirus spread rapidly in Italy and South Korea in the first half of March, screening of airline passengers traveling from those countries to the US was lax and haphazard, potentially contributing to the pandemic’s spread at home, according to a congressional investigation. The probe by the House Oversight Committee found that just 69 air travelers, among thousands, were barred from boarding US-bound flights, and many passengers received little, or conflicting, health advice during their trips or after arriving back in the US. The investigation faults a White House decision to allow local officials in Italy and South Korea conduct thermal screenings and other checks, saying that as a result, US health and border authorities had limited visibility into efforts by American allies to control the virus’s spread. President Trump had imposed a ban on travel from China on Jan. 31, extending it to Europe on March 14.<br/>

All US airport security screeners must start wearing masks and passengers should as well, the TSA said Thursday. The move comes as a government and industry working group begins considering a possible requirement that face coverings be worn by everyone entering an airport, two people familiar with the discussions said. More than 500 TSA screeners have tested positive for Covid-19, including six who died, according to the agency's website. The agency for months had left mask use voluntary. "TSA is making this change to protect our employees and travelers as social distancing cannot always be maintained in the screening process." TSA administrator David Pekoske said. The agency said it was "considering further changes to our screening system to further minimise the risk and to limit physical interactions in the security checkpoint." The new requirement will be phased in "over the coming days," the agency said. It is also asking passengers to wear facial protection.<br/>

Budget airline backer Bill Franke, who pioneered rock-bottom fares topped up by optional charges, says slashing prices alone will not be enough to get people flying again as carriers try to inch back to profitability after the coronavirus shutdown. Airlines will need to make passengers feel their health is secure before they get back on planes as the economy slowly stirs back to life, he said. "In the early days the passenger won't be motivated by the price of the ticket. They'll be motivated in large part by their own personal safety," said Franke, whose investment firm is the driving force behind several low-cost carriers worldwide. "The traditional 'we'll just sell seats cheap' - it doesn't really work here," said Franke, chairman of US budget carrier Frontier Airlines, Chile's JetSmart and Hungarian Wizz Air. The founder of private equity firm Indigo Partners, which has thrown its weight behind the practice of "unbundling" fares to let people pay only for what they use, is also a board member of Mexico's Volaris Airlines and chairs a Canadian startup. Franke said the early objective for airlines' financial recovery will be to break even on cash flow, which means recouping immediate expenses. "Then to start creating profitability - some increment above the cash required to pay the bills, and eventually trying to work your way back to the demand we saw in 2019. My view is that it will take 1.5-2 years to get back," he said.<br/>

Administrators of Virgin Australia have stopped issuing refunds and flight credits to customers who cancel their trips. In an email sent to customers who requested a refund or a credit, the airline said it had “temporarily paused issuing new travel credits and refunds while we wait for direction from the administrator”. The move is understood to be designed to shield the administrators – Deloitte partners Vaughan Strawbridge, John Greig, Sal Algeri and Richard Hughes – from personal liability for the credits and refunds. “Since the appointment of the administrators, they have been logging customer requests for refunds and credits while they work on a solution for affected customers,” he said. “The administrators will be able to provide more certainty on arrangements for those customers in coming days.” He said the administrators hoped to have a solution in place within a week and flight credits issued before the Virgin board appointed administrators on 20 April remained valid. Under insolvency law, the administrators are personally liable for debts they accumulate while in charge of the airline. Separately, they have also asked a court in the US to stop creditors taking action against Virgin there or seizing its aircraft.<br/>

Several Indonesian airlines have resumed domestic passenger flights following a letter from the COVID-19 task force allowing certain people to travel despite government travel restrictions. Service will be reopened gradually this month. Garuda Indonesia officially resumed domestic passenger flights on Thursday after suspending them in compliance with the government’s large scale social restrictions. “Flight reservations can be accessed through all ticket channels of Garuda Indonesia,” the airline’s president-director Irfan Setiaputra said Thursday. Garuda Indonesia will require passengers to provide ground staff with medical letters from hospitals stating that they are COVID-19 negative. The airline will also require state officials to provide documents, including official letters of duty, employee IDs and letters explaining the purpose of travel. Lion Air, Wings Air and Batik Air ‒ members of the Lion Air Group ‒ will resume domestic passenger flights on Sunday. “[We will apply] the physical distancing policy in the cabin by omitting middle seats in the three-seat configurations in economy class." <br/>

Airbus secured just nine net orders in April and delivered 14 jetliners after airlines desperate for cash put off accepting new planes and clamped down on spending to deal with a crisis that could last several years. The planemaker said Thursday that its order tally for the year through April stood at 299 after cancellations. “I didn’t expect many orders and don’t think Airbus will be anywhere near stated delivery goals during the second quarter,” said George Ferguson, a Bloomberg Intelligence analyst. “I would expect them to slow production so as not to build too much inventory.” Airbus faces a delicate balancing act to offer airlines the order flexibility they need while protecting its own revenue. <br/>

Jet engine manufacturer Rolls-Royce has confirmed it is preparing to make large-scale job cuts in the expectation of several years of lower commercial aviation demand as a result of the coronavirus pandemic. The company is considering making as many as 8,000 of its 52,000 global workforce redundant, according to sources with knowledge of the matter. The coronavirus crisis has severely affected Rolls-Royce’s business, because aircraft manufacturers have cut production rates and air traffic has plummeted, dealing a huge blow to its units servicing jet engines. About 4,000 UK workers have been furloughed, the company said on Thursday before its virtual annual meeting, meaning the government was paying 80% of the wages of about a quarter of the company’s UK workforce. With lower aerospace volumes expected for some time, however, Rolls-Royce would have to shrink permanently, its CE Warren East said. The company had to “take the difficult but necessary decisions to ensure the group emerges from this period with the appropriate cost base for what will be a smaller commercial aerospace market which may take several years to recover”, he said. The company expects to deliver only 250 engines this year, just over half its previous expectation of 450. <br/>