Coronavirus casts shadow on airlines, sizable impact seen

Even as air traffic volume has multiplied since 2003 when the SARS epidemic hit the aviation sector, the latest outbreak of the deadly coronavirus in China threatens to substantially disrupt the airline business which continues to be highly vulnerable to shocks and fears arising from infectious diseases.

The robust growth in China's aviation sector has seen an additional 450 million passengers flying to and from China and within the country annually compared with a decade ago. India has also seen exponential growth in air traffic since the launch of the first low-cost carrier Air Deccan in August 2003.

"While there are risks that this outbreak could cause a sizable disruption, history indicates that any effect on air transport would be temporary," global airlines body International Air Transport Association (IATA) has said.

Monthly international passenger traffic returned to its pre-crisis level in nine months after the SARS crisis.

In the past decades, SARS has been the most serious epidemic impacting traffic volumes of airlines. At the height of the outbreak (May 2003), monthly demand measured in terms of revenue passenger kilometre (RPKs) of Asia-Pacific airlines were 35 per cent lower than their pre-crisis levels.

"Overall in 2003, the loss of confidence and fears of global spread impacted both business and leisure travel to, from and within the region, resulting in Asia-Pacific airlines losing 8 per cent of annual RPKs and $6 billion of revenues," IATA said in its report.

The airline grouping said that the 2005 and 2013 episodes of avian flu had a much milder and shortlived impact and air travel rebounded quickly as the fears of global spread of virus eased.

"In the most recent episode of MERS Flu, which was focused more on a single country, the initial impact was a sharp slowdown, i.e. a 12 per cent decline in monthly RPKs to, from and within South Korea in the first month of the outbreak. However, air travel volumes began to recover after two months and had returned to pre-outbreak levels within 6 months," noted the report.

The spread of coronavirus seems far more ferocious compared to SARS and several countries have reported confirmed cases of infection. Ever since the outbreak, 172 people have died of the infection and over 7,000 infected with the deadly virus. The Chinese city of Wuhan has been the epicentre of coronavirus outbreak. India saw its first confirmed case of infection in Kerala on Thursday triggering panic.

The two Indian carriers Air India and IndiGo have suspended or curtailed their operations to Chinese cities and Hong Kong. Air India has temporarily suspended its flights to Shanghai and reduced frequency to Hong Kong in the wake of rising worries of viral infections.

Private carrier IndiGo has also halted its operations to Hong Kong and the Chinese city of Chengdu.

German flag carrier Lufthansa along with Swiss and Austrian airlines have cancelled all flights to and from mainland China until February 9. Additionally, it has closed sales for all flights to mainland China until February 29. Many other global carriers have temporarily suspended flights to and from China as a precautionary measure.

( With inputs from IANS )