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Thursday, December 2, 2021

Airlines prepare to respond to the threat of a surge in coronavirus infections in Europe

The surge of coronavirus cases in continental Europe has cast a shadow over the recovery of the tourism industry, and Ryanair CEO Michael O’Leary predicts that there will be a “tension period” next month.

The number of Covid cases and deaths in many countries in the region is rising rapidly, and some countries, including Austria and Slovakia, have implemented short-term nationwide lockdowns in an attempt to control the infection.

Worries about a weak winter have hit travel stocks. Shares of EasyJet, British Airways owner IAG, and Europe’s largest hotel group Accor have all fallen about 15% in the past three weeks.

O’Leary said it is “inevitable” that the rising number of new coronary pneumonia cases will disrupt travel. “It looks like Europe will become very nervous again at the worst time of the year, when people are making Christmas travel plans,” he said this week.

He added that this uncertainty may also affect advance bookings next summer, which often occur between Christmas and New Year.

According to OAG data, airlines have slightly reduced their flight schedules, and the number of reserved seats in Western Europe has declined in the past three weeks.

Axel Hefer, CEO of Trivago, said: “The intention to travel to Europe is affected by the increase in Covid cases across the continent and the lockdowns and announcements in many European countries.”

Hefer said that searches for domestic and international travel in Austria have dropped by 50%, and the Netherlands has dropped by 35%. The Dutch government has imposed new restrictions on bars, restaurants and non-essential shops.

According to data from hotel data provider STR, the room occupancy rate in Amsterdam has dropped from 62% in the last week of October to 41% this week, and room occupancy rates in Vienna and Munich have also declined.

According to data from online travel booking company Expedia, hotel search interest in Austria, the Netherlands, Belgium and Germany has declined.

Although the interruption is a blow to companies that are still recovering from the damage caused by the early stages of the pandemic, the situation is still much better than before the vaccine was allowed to reopen for travel earlier this year.

OAG said that for the aviation industry, November is usually a quieter month, and airlines still plan to increase capacity again during the busier Christmas period.

According to data from travel booking company Amadeus, search volume for flights so far this month is 80% higher than the same month last year.

Goodbody’s aviation analyst Mark Simpson (Mark Simpson) said that the current difficulties faced by airlines should not affect the prospects for long-term recovery.

He said: “No one buys the industry for Christmas prospects. They buy the summer of 2022 and 2023.”

“Aviation stocks have been impaired, as if they are facing the risks of last year, but I don’t think so. You must remain confident in the difficult months ahead.”

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