SYDNEY/CHICAGO: China's growth has helped power a global aviation boom over the last decade, but as the country curtails travel in the face of a new coronavirus, a slowdown could hit the industry harder than ever before.
U.S. officials said the White House had decided against suspending all flights there for now, but was still considering the measure. Margins at many carriers remain narrow, economic growth has been fragile amid a U.S.-China trade war and there are fears that the return of the 737 MAX, expected mid-year, could lead to overcapacity and push down fares. Airbus and Boeing orders have fallen from the peak levels of 2013 and 2014.
For Chinese airlines, the biggest of which are state-backed, the impact of the new coronavirus has been swift. On Wednesday, 23per cent of departures from Shanghai Hongqiao airport had been canceled, according to FlightRadar24, compared with 8per cent at the more internationally focused Shanghai Pudong airport.
Asian jet fuel prices have dropped and refiners' profits for the product have slumped to their lowest in more than 2-1/2 years over concerns that the coronavirus will hurt demand, although that will also help unhedged carriers keep a lid on costs.
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Source: ChannelNewsAsia - 🏆 6. / 66 Read more »