Airlines strive to avoid calamity as coronavirus blocks Italy

SEOUL/SYDNEY: Airlines around the world sank further into the crisis on Tuesday when the worsening of the coronavirus epidemic and the blockade of Italy affected passenger numbers, forced the cancellation of thousands of flights and delayed orders for planes.

Some carriers are facing calamities, and Korean Air warns that the virus outbreak could threaten its survival after it eliminated more than 80% of its international capacity, landing 100 of its 145 passenger planes.

The situation may worsen at any time and we cannot even predict how long it will last, Woo Kee-hong, president of South Korea's largest airline, said in a memo to staff that summed up the turmoil facing the industry. But if the situation continues for a longer period, we can reach the threshold where we cannot guarantee the survival of the company.

Qantas Airways of Australia said it would also reduce its international capacity, by almost 25% over the next six months, and delay a request for Airbus A350 aircraft due to a drop in demand that industry bosses estimate could affect revenue of airlines at up to $ 113 billion this year.

Qantas said it could no longer provide guidance on the financial impact of the coronavirus, which had estimated that February 20 could affect underlying earnings (EBIT) by up to approximately $ 98 million this financial year.

Its CEO and President will receive no salary, managers will not receive bonuses, and all staff are encouraged to take paid or unpaid vacations.

The major US airlines, American and Delta, suspended their financial guidance for 2020 and took drastic measures to combat the impact of the coronavirus.

Delta said it had seen net reserves fall by as much as 25% to 30% and that it expected the situation to deteriorate further. It is freezing hiring and offering voluntary licensing options for staff. This is clearly not an economic event, CEO Ed Bastian said at an industry conference. This is a scary event, probably more like what we saw on September 11.

The unprecedented blockade of all of Italy, which is convulsed by the worst outbreak of coronavirus in Europe, has generated a new disaster in global airlines.

Norwegian Air, British Airways, owned by IAG, easyJet, Wizz Air and El Al Israel Airlines were among the airlines that transported flights to and from the country, where there have been more than 9,000 virus infections and more than 460 deaths.

Ryanair said Tuesday that it would reduce its passenger forecast for the year ending in March by three million as a direct result of suspending almost all flights to and from its most important market for next month.