Omicron Curbs From Japan to Spain Wreak Havoc on Air Travel
Airlines Scramble to Navigate Fast-Degrading Travel Outlook
(Bloomberg) -- Airlines, passengers and businesses had to respond to a deluge of travel restrictions introduced to slow the spread of the omicron coronavirus variant.
An initial spate of flight bans from southern Africa, where omicron was first detected, gave way to wider-ranging measures that will make travel more expensive and less convenient -- if possible at all -- recalling earlier days in the pandemic.
From Tuesday, Japan will ban foreign visitors until more is known about the variant, Prime Minister Fumio Kishida said in Tokyo on Monday.
The U.K. reintroduced mandatory PCR tests for all arriving passengers and said they must self-isolate until receiving 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.
| Location | Action |
|---|---|
| U.S. | Restricted travel from eight countries in southern Africa |
| U.K. | Banned flights from some African countries, while arriving passengers must get tested and self-isolate until they get a negative result |
| Philippines | Travelers from European countries including Switzerland and the Netherlands won’t be welcome for several weeks |
| Australia | Suspended direct flights from nine southern African countries, and people who’ve arrived from those nations in the past 14 days must get tested and isolate for two weeks |
| Singapore | Postponed Dec. 6 launch of vaccinated travel lanes with the major travel hubs of Qatar, the United Arab Emirates and Saudi Arabia |
| Japan | New foreign visitors banned from Nov. 30 |
| Brazil | Restricted flights from certain African countries |
| Hong Kong | Non-residents from eight African nations barred from entry |
| European Union | Restrictions on travel from South Africa, Botswana, Eswatini, Lesotho, Mozambique, Namibia and Zimbabwe |
| Taiwan | Tighter quarantine requirements for six African nations |
| Israel | Foreign nationals banned from entry |
| Canada | No entry for foreign nationals who have traveled to southern Africa in past 14 days |
| Saudi Arabia | Suspended flights from southern African countries |
| Norway | Mandatory quarantine for arrivals from seven African countries |
Spain and Switzerland tightened access for arrivals from Britain, whose travel comeback has quickly been thrown into reverse. 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.
Travel Dilemma
Organizers of the World Aviation Festival in London told attendees the event will go on as scheduled. The group arranged for testing at two nearby hotels starting Tuesday, the day the new U.K. rules come into effect. Delegates flying in can self-isolate while awaiting results.
Still, Wizz Air Holdings Plc Chief Executive Officer Jozsef Varadi will be a no-show at the conference, the Budapest-based discount carrier told Bloomberg, with its president, Robert Carey, taking his place. Sessions will now be webcast to those who can no longer be there, organizers said.
Internal corporate functions are also being disrupted, with one such event in the U.K. shifting to hybrid from in-person, because the new testing and isolation requirements would have caught out some attendees set to arrive on Tuesday, according to a person familiar with the matter.
Negative Incentives
Leisure travel will also see an impact, while friends and relatives visiting loved ones after long absences are more likely to go through with a trip, said Alex Irving, an analyst at Bernstein in London.
“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.
Step Backward
Airlines face a return to the uncertainty of shifting rules and public-health developments that threw customer plans into chaos and undermined demand earlier in the pandemic.
British Airways, for example, halted flights to Hong Kong through at least Nov. 30 after one employee tested positive for Covid-19 and staff were sent into quarantine. The airline said it is keeping its operations under review as the situation evolves.
| More: |
|---|
| Airlines Sink Most Since 2020 on New Variant Fears, Travel Bans |
| Asian Reopening Stocks Lead Selloff as Omicron Fears Grow |
The risk of a second lost winter has already tanked shares of airline stocks, with the Bloomberg EMEA Airline Index down 18% for the month as of Friday. They made up some of the losses on Monday, amid reports that some people infected with the omicron variant developed mild symptoms.
British Airways parent IAG SA was up 3.1% as of 1:57 p.m. in London, with Ryanair Holdings Plc rising 6.4% in Dublin, Air France-KLM 2.7% in Paris and Deutsche Lufthansa AG gaining 4% in Frankfurt.
“Friday’s dramatic share price moves have already more than factored in a realistic downside case from the Omicron variant for most of our stocks,” James Ainley, an analyst with Citigroup, said in a research note.
The share-price drops will make it harder to raise fresh capital to repair balance sheets -- IAG 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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