- Title: Asian airlines count mounting costs of the coronavirus shock
- Date: 13th March 2020
- Summary: SYDNEY, AUSTRALIA (MARCH 12, 2020) (REUTERS) VARIOUS OF QANTAS PLANES PARKED AT AIRPORT VARIOUS OF QANTAS PLANE TAXIING ON RUNWAY QANTAS PLANE TAKING OFF TOKYO, JAPAN (MARCH 11, 2020) (REUTERS) ALL NIPPON AIRWAYS (ANA) PLANES PARKED AT HANEDA AIRPORT ANA PLANE PARKED ON TARMAC ANA LOGO ON TAIL PLANES FROM JAPAN AIRLINES (JAL) AND SKYMARK AIRLINES PARKED VARIOUS OF JET BRIDGES WITH NO PLANE CONNECTED TO THEM PLANES PARKED SEEN THROUGH WINDOW JAL PLANE PARKED ANA PLANE BEING PUSHED BACK FROM RAMP ANA LOGO ON PLANE TAIL JAL PLANE LANDING INCHEON, SOUTH KOREA (MARCH 12, 2020) (REUTERS) PLANES PARKED AT INCHEON INTERNATIONAL AIRPORT VARIOUS OF KOREAN AIR'S PLANES PARKED VARIOUS OF ASIANA AIR'S PLANES PARKED BEIJING, CHINA (MARCH 12, 2020) (REUTERS) VARIOUS OF AIR CHINA PLANES PARKED PLANES FROM AIR CHINA AND HAINAN AIRLINES PARKED PLANES FROM HAINAN AIRLINES, SOUTHERN AIRLINES, AND AIR CHINA PARKED HAINAN AIRLINES PLANE TAXING VARIOUS OF CHINA EASTERN AIRLINES PLANES PARKED WORKERS UPLOADING LUGGAGE ONTO PLANE VARIOUS OF HAINAN AIRLINES PLANES PARKED SINGAPORE (MARCH 11, 2020) (REUTERS) AVIATION INDUSTRY ANALYST, BRENDAN SOBIE SPEAKING (SOUNDBITE) (English) AVIATION INDUSTRY ANALYST, BRENDAN SOBIE, SAYING: "There have been some layoffs, but not too much yet, I mean with layoffs usually that is more of a long-term response, because the hope still is the market will recover in few months, so you want to have the crew in place when there is a recovery so you can resume your full schedule. So, the voluntary leave schemes are the most popular option." SOBIE SPEAKING DURING INTERVIEW (SOUNDBITE) (English) AVIATION INDUSTRY ANALYST, BRENDAN SOBIE, SAYING: "You don't want to see airlines operating flights just to maintain slots, it is bad for the environment, it is bad for business, it is bad for everyone. So hopefully we will see more down gauging as well, which is use smaller aircraft. It is very difficult to park big airplanes, because there is cost involved. It is environmentally the right thing to do in this crisis given the demand situation." HONG KONG, CHINA (MARCH 10, 2020) (REUTERS) CATHAY PACIFIC AIRPLANES PARKED AT AIRPORT FEDEX FLIGHT TAKING OFF AS CATHAY PACIFIC, HONG KONG AIRLINES AND HONG KONG EXPRESS AIRPLANES PARKED ON TARMAC AIRASIA PLANE TAXIING AS HONG KONG AIRLINES AND CATHAY PACIFIC AIRLINES STAND PARKED VARIOUS OF CATHAY PACIFIC, DRAGONAIR AND CARGO AIRPLANES PARKED ON TARMAC HELICOPTER FLYING OVER PARKED AIRPLANE FLEETS SAMUTPRAKAN, THAILAND (MARCH 12, 2020) (REUTERS) VARIOUS OF THAI AIRWAYS AIRCRAFT PARKED AT AIRPORT BANGKOK AIRWAYS PLANE TAXIING NEAR THAI AIRWAYS AIRCRAFT VARIOUS OF THAI AIRWAYS PLANES PARKED THAI AIRWAYS AIRCRAFT PARKING HANOI, VIETNAM (MARCH 13, 2020) (REUTERS) BAMBOO AIRWAYS PLANED PARKED AT AIRPORT ALONGSIDE AIRCRAFT FROM OTHER AIRLINES VARIOUS OF VIETNAM AIRLINES PLANE TAKING OFF VIETJET AIRPLANE PARKED AT AIRPORT ALONGSIDE AIRCRAFT FROM OTHER AIRLINES VIETNAM AIRLINES PLANE PARKED ON TARMAC VIETNAM AIRLINES PLANE TAXIING VIETNAM AIRLINES PLANE TAKING OFF
- Keywords: ANA Air China Asia Asiana Air Cathay Pacific Eastern airlines Hainan Airlines JAL Korean Air Qantas Southern airlines Thai Airways Vietnam Airlines airlines coronavirus losses planes
- Reuters ID: LVA001C4VV7T3
- Location: SYDNEY, AUSTRALIA / TOKYO, JAPAN / INCHEON, SOUTH KOREA / BEIJING, HONG KONG, CHINA / SINGAPORE / SAMUTPRAKAN, THAILAND / HANOI, VIETNAM
- City: SYDNEY, AUSTRALIA / TOKYO, JAPAN / INCHEON, SOUTH KOREA / BEIJING, HONG KONG, CHINA / SINGAPORE / SAMUTPRAKAN, THAILAND / HANOI, VIETNAM
- Country: Various
- Duration: 00:06:18
- Aspect Ratio: 16:9
- Topics: Health/Medicine
- Story Text: Airlines across Asia are feeling the pain as travel demand withers because of the coronavirus outbreak.
Several have grounded many flights and ditched their financial outlooks.
Below is a list of how Asia's biggest airlines have responded to the sharp drop in travel demand since the outbreak forced a multitude of cancellations.
QANTAS: Qantas Airways will cut its international capacity by nearly 25% over the next six months and delay an order for Airbus A350 planes.
Qantas' chief executive Alan Joyce will take no salary for the rest of the current financial year, the management team will receive no bonuses and all staff are being encouraged to take paid or unpaid leave.
The airline said it could no longer provide guidance on the outbreak's financial impact, which at the time of its half-year results on Feb. 20 it had estimated at A$100 million to A$150 million hit to underlying core earnings this financial year.
JAPANESE AIRLINES: Both Japan's All Nippon Airways (ANA) and Japan Airlines Co (JAL) have announced plans to reduce domestic flights, citing a drop in demand due to cancellations and delays of sporting and cultural events amid the coronavirus outbreak. Both airlines say domestic bookings for March are down approximately 40% from the same month last year, according to Japanese media reports.
JAL said on Friday (March 13) it would reduce 1,468 flights on 60 domestic routes across the group between March 20-28.
The outbreak has already forced the carriers to scale back their international flights.
SOUTH KOREAN AIRLINES: Korean Air Lines Co, the national flag carrier, has warned that the coronavirus outbreak could threaten its survival after more than half of the world restricted passengers entering from South Korea.
Woo Kee-hong, Korean Air's president, said on Monday (March 9) more than 80% of South Korea's biggest carrier's international capacity had been cut as a result of travel restrictions globally, compared with a 18% cut made during the 1997-1998 Asian financial crisis.
Woo said Korean Air had grounded about 100 of its 145 passenger aircraft. Korean Air said on Tuesday (March 10) it is also encouraging foreign pilots to take leave from next month.
Self-help measures included deferring investments, cutting down on operational expenses and encouraging employees to take voluntary leave, he said.
South Korea's Asiana Airlines and budget carriers Jin Air, Air Busan and T'way Air suspended all routes between Japan and South Korea on Monday.
CHINESE AIRLINES: China's aviation regulator said on Thursday (March 12) that the total number of airline passengers in February fell 84.5% year-on-year to 8.34 million, underscoring the impact of the coronavirus outbreak on carriers operating in the world's No. 2 economy.
The epidemic, which originated in the transportation hub city of Wuhan and quickly spread to the rest of China, has caused dramatic cuts in both domestic and international flights in the country.
The Civil Aviation Administration of China (CAAC) has pledged to provide subsidies to Chinese airlines.
China's biggest airlines include Air China, China Southern, China Eastern, and Hainan Airlines.
CATHAY PACIFIC: Cathay Pacific warned of a substantial loss in the first half of the year and flagged more cuts in flights due to the "unprecedented challenge" from the coronavirus outbreak that has forced it to ground more than half its fleet.
Cathay, which said 80% of employees had agreed to take three weeks of unpaid leave to cut costs, added it does not rule out job cuts as the virus situation unfolds and it is seeking delays in aircraft deliveries.
It has already grounded more than 140 planes and slashed capacity by two thirds across its network for March and April, versus plans for a 40% cut.
THAI AIRWAYS: The president of Thailand's legacy carrier, Thai Airways International Pcl resigned on Thursday (March 12), the company said, as the airline deals with a weakening travel industry and a transformation plan.
Thai Airways' losses in 2019 widened to 12.2 billion baht ($385 million) from losses of 11.6 billion baht a year earlier, as airlines across the world are trying to respond to the drop in travel from the coronavirus pandemic.
In February, Sumeth Damrongchaitham and other Thai Airways executives took a salary cut in a bid to reduce expenses.
Tourist arrivals slumped 44.3% in February from a year earlier. Tourism receipts account for about 12% of the Thai economy.
VIETNAM AIRLINES: Vietnam-based airlines have been forced to cut salaries and encourage their employees to take unpaid leave as carriers struggle with the impact of coronavirus on travel demand.
The carriers have recently suspended all flights to China and South Korea and scaled back flights to other international destinations in the wake of an epidemic that has killed more than 4,200 people worldwide. Salaries for senior positions at Vietnam Airlines, the country's flag carrier, have been cut by at least 20%.
Duong Chi Thanh, Vietnam Airlines chief executive officer, told local media late last month that 40% of the company's fleet of 100 aircraft had been laid idle due to the virus, directly affecting 20,000 of its employees.
The Civil Aviation Authority of Vietnam has said local airlines would lose up to 25 trillion dong ($1.08 billion) in revenue in the first quarter this year.
(Production: Thomas Suen, Jill Gralow, Akira Tomoshige, Joseph Campbell, Aleksander Solum, Vorasit Satienlerk, Daewoung Kim, Minh Nguyen, Phyllis Xu)
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