Airlines face threat from rise of Covid infections in Europe

A surge in coronavirus cases in mainland Europe has cast a shadow on the tourism industry’s recovery, with Ryanair chief executive Michael O’Leary forecasting a “bad period” for the next month .

The cases of death and deaths are growing quickly across many countries in the region, and several, including Austria and Slovakia, have imposed short-lived national lockdowns in an attempt to contain infections.

Fears of a weak winter have hit travel stocks, with shares of easyJet, owner of British Airways’ IAG and Europe’s largest hotel group Accor, each down around 15% in the past three weeks. .

O’Leary said it was “inevitable” that increased Covid cases would disrupt travel. “It looks like Europe is coming back very nervous at the worst time of the year, when everyone is planning their Christmas travel,” he said this week.

Uncertainty could also weigh on early bookings for next summer, he added, which tends to come between Christmas and New Year’s.

According to data from OAG, airlines have reduced their flight schedules slightly, and the number of scheduled seats in Western Europe has decreased over the past three weeks, according to data from OAG.

Axel Hefer, chief executive of Trivago, said: “European travel intentions have been affected by the increase in Covid cases across the continent, and by closures and announcements in many European countries. Europe,” said Axel Hefer, chief executive officer of Trivago.

Hefer said there was a 50% drop in domestic and international travel searches in Austria and a 35% drop in the Netherlands, where the government introduced new restrictions on bars, restaurants and shops. essential aviation.

Room occupancy rates in Amsterdam fell from 62% in the last week of October to 41% this week, and there were also declines in Vienna and Munich, according to data from STR, a data provider. hotel.

According to Expedia, the online travel booking company has reduced hotel search preferences in Austria, the Netherlands, Belgium and Germany.

While this disruption is a blow to companies still recovering from damage caused earlier in the pandemic, the situation is much better than it was before the vaccine allowed reopening to travel. schedule at the beginning of this year.

November is usually a quieter month for the industry, and airlines are still planning to ramp up capacity again as we head into the busier Christmas season, OAG said.

According to travel booking company Amadeus, searches for flights this month are 80% higher than in the same month last year.

Mark Simpson, an aviation analyst at Goodbody, said the current difficulties for airlines shouldn’t detract from the long-term recovery picture.

“Nobody is buying this area for the Christmas outlook, they are buying for the summer of 2022 and 2023,” he said.

“Airline stocks have fallen as if they were taking on last year’s risk, but I don’t see it that way. You must keep your faith in the difficult months ahead. ”

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