Airlines Are Scrambling to Navigate a Fast-Degrading Travel Outlook Amid Concern Over the Omicron Coronavirus Variant

Businesses, airlines and passengers all had to react to the deluge in travel restrictions that was announced this weekend to stop the spread of the variant of the Omicron Coronavirus.

An initial spate of flight bans from southern Africa, where omicron was first detected, gave way to more wide-ranging measures that will make travel more expensive and less convenient — if possible at all — recalling earlier days in the pandemic.

United Kingdom reintroduced mandatory PCR testing for all passengers arriving at the airport. They were required to self-isolate until they receive a negative result. Israel closed to all inbound foreign nationals for 14 days, the Philippines said travelers from European countries including Switzerland and the Netherlands won’t be welcome for several weeks and Singapore delayed the launch of vaccinated travel lanes with Qatar, the United Arab Emirates and Saudi Arabia.
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Spain and Switzerland made it harder for British tourists to arrive from Spain, which has seen their travel recovery quickly reversed. U.K. low-cost carrier EasyJet Plc said Sunday its flight schedule was operating as normal, “however we continue to monitor the situation closely.”

While the full impact will get clearer over coming days, “this will be problematic for business travel — particularly inbound into the U.K.,” said Martin Ferguson, a spokesman for American Express Global Business Travel.

Organisers at the World Aviation Festival in London assured attendees that everything will continue on schedule starting Tuesday as the U.K. regulations go into effect. Two nearby hotels were chosen for the testing, so guests could self-isolate and wait to see results.

An internal corporate event, which was held in the U.K., was moved from in-person to hybrid, as the new isolation testing would have caught some of those who were due to arrive Tuesday. A person with knowledge of the matter said that this change had been made because it could have caused problems for attendees.

Schiphol Airport Coronavirus Swab Testing For Travelers
© 2020 Bloomberg Finance LP To be allowed into the Covid-19 Test Center at Schiphol Airport Amsterdam, travelers must wait.

Omicron and leisure travel: What does it mean?

According to Alex Irving of Bernstein London, leisure travel is also expected to have an impact. Friends and family visiting relatives after long absences will be more inclined than others, he said.

“Christmas bookings will obviously be weaker than we had expected prior to the omicron variant,” he said. “As you add barriers to travel such as the PCR tests and isolation requirements, all that does is changes the incentives.

Now, airlines face the same uncertainty as before the pandemic: shifting regulations and changes in public-health policies.

British Airways, among others, has halted all flights to Hong Kong from Nov. 30 through the end of November after one staff member tested positive. The airline also sent employees into quarantine. The airline said it’s keeping its operations under review as the situation evolves.

Singapore and Japan are among countries that have said they’re considering tighter border restrictions.

Stocks in airline stocks are already at risk due to the possibility of another winter. The Bloomberg EMEA Airline Index has fallen 18% since this time. This will make it harder to raise fresh capital to repair balance sheets — British Airways parent IAG SA has 12.4 billion euros ($14 billion) in net debt, for example.

“This comes at a time of year when airlines will seek to bolster liquidity and to a modest extent profitability, and is after an already arduous 18 months of revenue depletion,” said John Strickland, who heads London-based JLS Consulting.


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