Coronavirus Economic Impact on Airline Less than 9/11 Attacks

By Javier Albisu

Brussels, Mar 3 (EFE).- The head of IAG, which owns British Airways and Iberia, said Tuesday he does not believe the coronavirus will be as damaging to the aviation industry as the attacks of 11 September 2001.

Willie Walsh said demand should stabilise in the coming weeks.

“I don't see this as being similar to 9/11,” he told the Airlines For Europe conference in Brussels.

“9/11 was clearly a trans-Atlantic issue. It represented a very significant fall in the demand in the trans-Atlantic.

“But it did recover pretty quickly when US skies reopened.”

“But if it follows the pattern that we saw in Asia, we would expect it to stabilise in a couple of weeks,” he added.

“Clearly the demand into and out of Asia has stabilised at a lower level.”

The Al-Qaida suicide attacks on New York and Washington DC, which killed almost 3,000 people, spurred an unprecedented economic crisis in the airline industry and saw a number of companies like Australia's Ansett, Belgium's Sabena and Air Canada fold.

The heads of companies representing 70 per cent of commercial flights in Europe were unanimous in their belief the sector was ready to withstand the effects of the Covid-19 outbreak around the world.

Following the example set by IAG, many major airlines have cancelled flights in and out of China as a consequence of the disease, which has killed more than 3,000 since it emerged in the city of Wuhan last year. Lufthansa has suspended its flight connections with Italy, Hong Kong and South Korea.

Irish airline Ryanair has reduced its travel to Italy, a coronavirus hotspot in Europe.

The impact of Covid-19 on the stock markets has been strong in recent weeks, with drops of up to 10 per cent, although these figures recovered somewhat this week.

Michael O'Leary, Ryanair founder, said: “There's a lot of misinformation out there.

“Social media is a scourge for idiots but common sense usually wins out in a reasonably short period of time.”

He predicted demand for flights would soften in the coming weeks before settling around Easter, providing there was no “inflammation in Europe”.

O'Leary said airlines should be able to focus on summer travel.

Speaking to Efe on the sidelines of the event, Walsh said: “It will be a challenge for the industry, but we've been through these issues before. The industry will respond.”

“This is a temporary issue. Clearly from an IAG point of view, we start from a very strong position, with 7 seven billion euros,” he added.

Airline heads have backed the European Union's Single Sky project.

Walsh said it was a scandal that airspace over the continent was still operated the same as it was four decades ago.

The project, which has been in the works for 20 years, would reform the airspace management over the EU, which could save some 37 billion euros annually and cut carbon emissions.

Organizers of the event in Belgium, where 13 Covid-19 cases have been detected, recommended that guests avoid greeting each other with handshakes or kisses.

EFE© 2020 EFE News Services (U.S.) Inc.