Airlines’ execs get pep talk on virus
WASHINGTON — President Donald Trump sought to reassure U.S. airline leaders on Wednesday as the industry confronts a potential drop in travel demand because of the coronavirus epidemic.
In a meeting with chief executives of American Airlines Group Inc., Southwest Airlines Co., United Airlines Holdings Inc. and other carriers, Trump acknowledged the coronavirus and international travel restrictions implemented to contain it have affected their sector, but he said it remains safe to fly to the destinations serviced by the carriers.
“As certain areas get to be more of a problem, we may close them up as we have done with numerous areas. At this moment, we think we have it very much in hand,” Trump said.
Global air traffic is on pace for the first annual drop in 11 years because of the coronavirus, according to the International Air Transport Association. Last month, the airline trade group predicted lost revenue of about $30 bil
lion because of the outbreak — and since that forecast, the infection’s spread around the world has only worsened.
Shares of United Airlines rose 2% Wednesday; American Airlines closed up 3.7%, and Southwest Airlines stock was up almost 4%.
Several major companies have curtailed business travel as a precautionary move to protect employees against exposure to the virus. Ford Motor Co. on Tuesday announced it would pause nonessential business travel until March 27 for both international and domestic trips. Other multinational companies including Toyota Motor Corp., Fiat Chrysler Automobiles, Nestle SA and L’Oreal SA have also made at least temporary plans to curtail business trips because of the virus.
During the meeting, Trump acknowledged that the U.S. travel restrictions tied to the coronavirus have affected airlines and that “a lot of people are staying in our country,” shopping and staying at U.S. hotels.
“From that standpoint, I think probably there’s a positive impact but there’s also an impact on overseas travel which will be fairly substantial,” Trump said.
He later said, “large portions of the world are very safe to fly, so we don’t want to say anything other than that.”
Trump reiterated that the U.S. may impose additional entry restrictions on travel ers from areas hard hit by the virus, without naming them.
At a news conference in Washington, leaders of several travel industry associations said they could see some cancellations in the coming months and other declines in the travel business, but didn’t anticipate broader long-term disruptions.
“It’s springtime, just ahead of the peak travel season for business and leisure, spring break, family vacations, conventions and trade shows,” said Roger Dow, president of the U.S. Travel Association.
He said the group is seeing scattered cancellations of meetings and other gatherings, but said the people were “not listening to what the facts are.”
In the U.S., United Airlines withdrew its 2020 profit forecast, citing the financial impact of the coronavirus outbreak in China. United, the U.S. leader in flights across the Pacific, is also nixing fees for reservations made this month, in a sign that the company is looking to shore up bookings amid shaky demand.
The Chicago-based carrier has suspended flights to China, where the virus originated, as have American Airlines and Delta Air Lines Inc. In addition, Delta and United have pared service to other Asian destinations as well.