Since the coronavirus epidemic started in January, the travel and tourism industry has taken hit after hit. Experts and industry leaders are afraid of 9/11 or recession-like effects. The demand for travel then plunged and was slow to recover.
“Global travel is effectively shutting down,” he said. “It’s going to take a while to get it back up and running again. This is going to be a very tough year for the travel and tourism industry”, said Mark Zandi, chief economist for Moody’s Analytics.
He said given the global nature of the outbreak, the travel and tourism industry may have impact of coronavirus larger than the 9/11 or the 2003 SARS epidemic.
Tourism Economics, a global travel research firm, says the travel industry faces the most acute coronavirus pressure for three reasons: official travel bans, cancellations of conferences and risk aversion. Hurting airlines, casinos, car rental companies, cruise lines, tourist attractions, and other transportation industries are all facing the ripple effects of this trifecta.
Southwest Airlines CEO Gary Kelly said last week that, at the end of February, the airline’s booking took a nosedive. More than 95 percent of Southwest flights are within the U.S., making it a key barometer of U.S. demand for transportation. The projected financial impact on bookings could be from $200 million to $300 million.
Last week, The International Air Transport Association, which represents global airlines, raised its forecasts of the global financial impact from COVID-19 from $29.3bn to between $63bn and $113bn as reservations struggled to expand beyond Asia.
Hotels near airports with a large number of international flights were seeing room demand decline. Demand was down 12 percent at hotels near Newark International Airport in New Jersey, demand at Chicago O’Hare International Airport hotels was down 8.1 percent.