Once Again, Travel Is The Target — Can Airlines Keep Bouncing Back?
This is the time of year when millions of travelers are making summer vacation plans. Analysts expected record numbers to book flights to international destinations.
Their outlook was so optimistic because global passenger traffic had shot up 7.1 percent in January, compared with last year, according to the International Air Transport Association. "The record load factor is a result of strong demand for our product," Tony Tyler, CEO of the trade group, said in a statement earlier this month.
But then explosions hit in Brussels on Tuesday. At least 30 people were killed and hundreds wounded in attacks at Brussels' main international airport and on a subway.
Travelers, once again, were the victims of barbarism. For now at least, that dims the outlook for travel and tourism.
All flights to and from the Belgian capital were canceled Tuesday, causing carriers to divert to other airports, or even other countries. For example, Delta Air Lines says it sent a Brussels-bound flight to Amsterdam. Eurocontrol says the Brussels' Zaventem airport will remain closed on Wednesday.
Even airlines without direct flights into Brussels are feeling the turbulence; they have European code-share partners that got hit with disruptions. Deutsche Lufthansa said it canceled 11 flights to Brussels and Emirates Airline had to divert a flight to Duesseldorf, Germany.
All of that put a damper on the European tourism sector at a critical time: This Sunday is Easter, a peak travel period for Europeans enjoying a spring break.
Amid the jitters about travel disruptions, shares of Air France-KLM fell 4 percent Tuesday. American Airlines' stock closed down 1.6 percent to $42.76. Delta and United also slipped more than 1 percent.
How long the dip will last is anyone's guess. But travel stocks typically slip after a terrorist attack, and then bounce back as travelers recover from their initial shock.
For example, in the weeks following the Sept. 11, 2001, attacks in the U.S, travel bookings plunged. But in subsequent years, they rose to record levels. That rebound pattern has held up in the aftermath of attacks on tourists and travelers in Bali (2002), Madrid (2004), London (2005) and Paris (2015).
It's possible this latest attack could have a longer impact because terrorists for ISIS may be causing more alarm. Belgium is now at a Level 4 terror alert — the highest level.
Government officials around the world are reacting, too. Australia's Department of Foreign Affairs and Trade changed its travel advisory for Belgium from "a high degree of caution" to "reconsider your need to travel."
In this country, the Port Authority of New York and New Jersey says it is "stepping up security at its three major airports, the bridges and tunnels and Port Authority Bus Terminal."
But within the aviation industry, officials continue to be optimistic about the long-term future because so many people want to travel.
Ben Baldanza, the former chief executive of Spirit Airlines, discussed the Brussels attack with NPR's Morning Edition host Renee Montagne on Tuesday. Baldanza, who is now on the board of Icelandic low-cost carrier WOW Air, said he was confident air travel would bounce back as it always does.
The Brussels attacks "won't affect in a meaningful way the long-term view of air travel," Baldanza said. "People want to see the world; people want to engage in commerce and meet friends."
His words were echoed by the International Air Transport group, which put out a statement. Aviation "brings the world together and fosters greater understanding of people and cultures. Those who commit terrorist acts know and fear this, and it is why air travel is so often a target," chief executive Tyler said.
"But terrorists will never succeed in destroying the fundamental urge and right of people to travel, explore and learn about the world," Tyler said.
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