Richard Clough, Bloomberg News
The coronavirus outbreak is rapidly becoming a crisis of historic proportions for the global air travel industry.
Commercial air traffic is poised to fall 8.9 percent this year as the outbreak causes a sudden plunge in demand around the world, according to Jeffries. That would be the biggest drop in data that goes back to 1978 — dwarfing the impact following the 9/11 terrorist attacks and the recession that ended in 2009 — and only the fourth decline overall.
“It’s unprecedented,” said Jeffries analyst Sheila Kahyaoglu.
The estimate throws into stark relief the crisis engulfing airlines and the broader aerospace industry. A global trade group for carriers said this week that the industry will lose as much as US$131 billion in sales because of the outbreak, which has killed 3,400 people and infected more than 100,000 worldwide.
While air traffic has proven resilient through past disruptions, the broad and unpredictable spread of the new coronavirus differs from more geographically contained outbreaks such as SARS in 2003.
“When it passes, it should be a pretty rapid recovery, but this is global now and the shoes are falling at different rates,” said aerospace consultant Kevin Michaels. “It seems like this is going to be drawn out.”