European airlines brace for turbulence as summer hopes fade
Airlines have for months been looking toward a rush of Covid vaccine introductions in early 2021 to rescue their battered industry. But European carriers counting on a bumper summer season to restore revenue and rebuild balance sheets are becoming fearful that a recovery will arrive too late for the vital travel period. While vaccine rollouts were stoking forecasts for a 90% rebound in Europe’s leisure market just a month ago, fast-spreading new viral strains are prompting people to shelve vacation plans at what should be the busiest time for bookings. European carriers are already among the worst affected by Covid‑19. With profits heavily dependent on April through September, another lost summer could reach beyond industry stragglers and strike at leading low-cost carriers and tour operators. It could also delay a rebound in the lucrative business markets on which the biggest network airlines depend. “The problem with Europe is that there are so many borders and each country has its own requirements,” says Mark Manduca, an analyst at Citigroup in London. “Passengers don’t know what the restrictions are or what sort of tests are required, so it’s much harder to fill up planes compared with large countries such as the US or China, where there are no borders to cross.” The latest blow came when Britain in January responded to its detection of a mutant viral strain and the emergence of another in South Africa by imposing mandatory testing on top of quarantines, even for those few people still allowed to travel under a new national lockdown. Seat capacity at UK-based airlines plunged 27% in a week, compared with declines of 10% in North America and 5% in the Asia-Pacific region over the same period, according to London-based aviation consulting firm Ishka Ltd. Alexandre de Juniac, DG of the IATA, said on Jan. 12 that the measures threaten to “shut down flying” and scuttle any recovery in demand by Easter, the traditional start of Europe’s prime travel season. <br/>
https://portal.staralliance.com/cms/news/hot-topics/2021-01-20/general/european-airlines-brace-for-turbulence-as-summer-hopes-fade
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European airlines brace for turbulence as summer hopes fade
Airlines have for months been looking toward a rush of Covid vaccine introductions in early 2021 to rescue their battered industry. But European carriers counting on a bumper summer season to restore revenue and rebuild balance sheets are becoming fearful that a recovery will arrive too late for the vital travel period. While vaccine rollouts were stoking forecasts for a 90% rebound in Europe’s leisure market just a month ago, fast-spreading new viral strains are prompting people to shelve vacation plans at what should be the busiest time for bookings. European carriers are already among the worst affected by Covid‑19. With profits heavily dependent on April through September, another lost summer could reach beyond industry stragglers and strike at leading low-cost carriers and tour operators. It could also delay a rebound in the lucrative business markets on which the biggest network airlines depend. “The problem with Europe is that there are so many borders and each country has its own requirements,” says Mark Manduca, an analyst at Citigroup in London. “Passengers don’t know what the restrictions are or what sort of tests are required, so it’s much harder to fill up planes compared with large countries such as the US or China, where there are no borders to cross.” The latest blow came when Britain in January responded to its detection of a mutant viral strain and the emergence of another in South Africa by imposing mandatory testing on top of quarantines, even for those few people still allowed to travel under a new national lockdown. Seat capacity at UK-based airlines plunged 27% in a week, compared with declines of 10% in North America and 5% in the Asia-Pacific region over the same period, according to London-based aviation consulting firm Ishka Ltd. Alexandre de Juniac, DG of the IATA, said on Jan. 12 that the measures threaten to “shut down flying” and scuttle any recovery in demand by Easter, the traditional start of Europe’s prime travel season. <br/>
