COVID-19 and Trump's 'Travel Ban'... Airline Industry Stocks Plummet

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Amid difficulties faced by major global airlines suspending large-scale operations due to the spread of the novel coronavirus infection (COVID-19), U.S. President Donald Trump's ban on entry from Europe has become an additional adverse factor.

According to Bloomberg and others on the 12th (local time), airline-related stocks plummeted that day. Among U.S. airlines, United's stock fell 18%, while Delta and Boeing dropped 15% and 18%, respectively. Among European airlines, Norwegian Air plummeted 33%, along with Air France (-12.7%) and Lufthansa (-14%) experiencing significant declines.

Norwegian Air, a low-cost airline from Norway, announced that it would temporarily reduce its workforce by half and suspend 40% of long-haul routes and 25% of short-haul routes. They added that they plan to lay off up to 50% of their employees.

Jacob Schram, CEO of Norwegian Air, said, "The new regulations have added further pressure to an already difficult situation," and urged, "International organizations should step up to protect jobs in the aviation industry and help recover from the global economic crisis."

President Trump announced that he would block travel to the United States from European countries excluding the United Kingdom and Ireland for 30 days. In response, U.S. airline Delta Air Lines decided to temporarily suspend some routes from European cities such as Paris, Amsterdam, and Portland to the United States. The airline information company OAG estimated that 6,700 round-trip flights would be affected by the U.S. government's entry restrictions from Europe.

Jefferies Financial Group predicted that commercial air transport would decrease by 8.9% this year, marking the largest decline in 42 years. A representative from the International Air Transport Association (IATA) said that the entry ban from Europe announced by President Trump would "have a negative impact on the overall economy."

This content was produced with the assistance of AI translation services.