Continental Europe’s wave of coronavirus cases has cast a shadow over the travel industry’s recovery, with Ryanair CEO Michael O’Leary predicting a “charged period” over the next month.
Covid cases and deaths rising fast Across several countries in the region, several, including Austria and Slovakia, have imposed short national lockdowns in an effort to rein in infections.
Concerns about a weak winter weighed on travel stocks, with shares of easyJet and IAG owner of British Airways and Europe’s largest Accor hotel group down nearly 15 per cent over the past three weeks.
O’Leary said it is “inevitable” that a rise in COVID-19 cases will disrupt travel. “It looks like Europe is going to get really nervous again at the worst time of the year, when people make their Christmas travel plans,” he said this week.
He added that the uncertainty could also affect early bookings for next summer, which tend to pop up between Christmas and New Year’s.
Airlines have cut their flight schedules slightly, and the number of scheduled seats in Western Europe has fallen over the past three weeks, according to data from the OAG.
“European travel intentions have been affected by the rise in Covid cases across the continent, and the closing of advertisements and advertisements in many European countries,” said Axel Heffer, CEO of Trivago.
Hever said there was a 50 per cent drop in searches for domestic and international travel in Austria, and 35 per cent in the Netherlands, where the government imposed new restrictions on bars, restaurants and non-essential stores.
Room occupancy in Amsterdam fell from 62 per cent in the last week of October to 41 per cent this week, and there were also drops in Vienna and Munich, according to figures from STR, the hospitality data provider.
There has been a drop in interest in hotel searches in Austria, the Netherlands, Belgium and Germany, according to Expedia, the online travel booking company.
While the disruption is a blow to businesses still recovering from the damage they did earlier in the pandemic, the situation is still much better than it was before vaccines allowed travel to reopen earlier this year.
November is usually a quieter month for the industry, and airlines are still planning to ramp up capacity again in the busiest Christmas season, according to the OAG.
Flight searches so far this month have been 80 percent higher than they were in the same month last year, according to travel reservations company Amadeus.
Mark Simpson, aviation analyst at Goodbody, said the current difficulties for airlines should not detract from the picture for long-term recovery.
“Nobody is buying the sector for the Christmas prospects, they are buying in the summer of 2022 and 2023,” he said.
The airline stocks have derailed as if they were taking risks last year, but I don’t see that. You have to keep your faith in what will be some difficult months ahead.”