Travel industry grapples with cancellations, changes amid COVID-19 outbreak
Travel industry grapples with cancellations, changes amid COVID-19 outbreak
In response to the spread of COVID-19, Delta reduced service to South Korea last week, while United announced it’s limiting service to Japan, Singapore and Seoul, citing a 75% decline in demand for trans-Pacific routes. The International Air Transport Association took data from the SARS outbreak in 2003 and calculates the disease will cost the airline industry $30 billion.
Travel agent John Dekker at the Los Angeles-based Surf City Travel said he’s been tracking lost revenue from flight cancellations for about a week.
“We figured we’ve lost about $65,000 on commissions that we would have earned,” Dekker said. “For a smaller agency that we are, that’s a lot of money.”
If there are enough cancellations, airlines start reconsidering whether the cost of flying is worth it.
“If you don’t have passengers on that plane, if you don’t have cargo being shipped and the revenue coming in from that, it makes no sense to operate a flight,” said Henry Harteveldt, president of Atmosphere Research Group.
United is offering fee waivers for flights to cities in northern Italy, China and South Korea. JetBlue is starting to waive cancellation and change fees.
Charles Leocha, president of Travelers United, said consumers can purchase travelers insurance, but many policies don’t cover epidemics.
“The No. 1 thing you have to do is read the policy,” Leocha said.
Insurance companies do offer cancel-for-any-reason plans, but, Leocha said, they’re often expensive.
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