ACI Asia-Pacific paints grim picture of traffic and tourism losses from coronavirus crisis : Moodie Davitt Report

Key action points

As noted by the ICAO Air Transport Committee, ACI would like to reiterate and draw to the attention of States the following actions:

Need for clear responsibilities between agencies to be defined
Need consistent approach to screening, equipment and disinfection
Need a clear picture and justification for travel restrictions
Need to avoid creating crowds and queues on arrival due to screening requirements
Need for clear guidance from health and civil aviation authorities on measures to be taken
Direct and indirect economic impact needs to be considered
Screening approaches may be ineffective given the incubation period of the virus, and an inability to accurately determine a passenger’s point of origin if they are not travelling on a single itinerary.
Need to better coordinate between organizations, states and industry to have a consistent global response in this difficult situation

Source: ACI Asia-Pacific

ASIA PACIFIC. Stefano Baronci, Director General of Airports Council International (ACI) Asia-Pacific today issued a stark outline of the coronavirus outbreak’s impact on aviation, airports and tourism.

Here are some of his key observations:

– Given that China is the world’s second-largest economy, the coronavirus outbreak seems certain to have a significant effect on the global economy for at least a quarter or two. The impact of SARS in 2003 was estimated to be a global economic loss of about US$40-50 billion, and at that time China was only the world’s seventh-largest economy.

– However, given that China’s GDP share of 17% globally in 2019 was four times higher than in 2003 and with confirmed cases more than double the total of SARS (as of 7 February), the coronavirus outbreak may cost the global economy well above US$300 billion.

– The impact on air passenger traffic in the Asia Pacific region will be certainly acute in Q1 of 2020. According to ICAO data, history shows that SARS had the most serious impact on traffic. At the height of the outbreak (May 2003), monthly RPKs of Asia-Pacific airlines were -35% lower than their pre-crisis levels. Overall in 2003, Asia-Pacific airlines lost 8% of annual RPKs and US$6 billion of revenues. We can likely expect a much more significant impact on traffic this time.

Stefano Baronci: “The impact on air passenger traffic in the Asia Pacific region will be certainly acute in Q1 of 2020”

– In 2003 the total number of passengers moving through Chinese airports amounted to about 187 million vs 1.26 billion in 2018. Notably the volume of international passengers increased from 50 million to 114 million over the same period (annual average growth by +9.6%) – the segment that will be more largely impacted by the air transport ban.

ICAO also estimates that the seat capacity reduction in February and March compared to 2019 will be about -35% for Chinese domestic carriers and -75-83% for foreign carriers. In absolute terms, the reduction in passenger traffic in China would amount to approximately 16.4 to 19.6 million passengers for 1Q 2020, which would translate to approximately US$4.1-US$4.9 billion potential loss of revenue for Q1 2020. (ICAO estimates based on OAG scheduled data).

– The impact on tourism will also be substantial. China is the world’s largest spender, with one fifth of international tourism spending (US$227 billion in 2018), with Thailand, Japan and Australia to be particularly impacted by the loss of Chinese tourists (respectively US$9.5 billion, US$8.1 billion and US$1.4 billion). More information is provided in this presentation from the ICAO Air Transport Committee which convened on 7 February.

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