Ban on European travel to U.S. will batter airlines, already roiled by coronavirus

By Lisa Baertlein and David Shepardson

LOS ANGELES/WASHINGTON (Reuters) – The new U.S. ban on foreign citizens entering the country if they have traveled to Europe in recent weeks will heap more pressure on airlines already reeling from the coronavirus pandemic, hitting European carriers the hardest, analysts said.

The 30-day restrictions from Friday, which exclude Britain, are similar to those that went into effect targeting China on Feb. 1, and come after the outbreak’s rapid spread across the European continent and in the United States.

Industry watchers warned the move could also create chaos at dozens of airports across Europe as passengers attempt a last-minute rush to fly to the United States before the ban takes effect.

Flights from Europe can still operate to a limited number of U.S. airports with enhanced screening under measures announced on Wednesday evening. But only U.S. citizens, permanent residents and immediate family members will be allowed in, severely denting the passenger base and hurting the U.S. tourism industry.

U.S. President Donald Trump said the ban was needed because the country was entering a “critical time” in the fight against the virus, which has spread across the United States and killed at least 37 people and infected 1,281.

“We made a lifesaving move with early action on China. Now we must take the same action with Europe,” Trump said in an address to the nation. “We will not delay.”

The ban stops movement of people, not goods, he later clarified on Twitter.

U.S. airlines had already slashed flight schedules to Italy, facing the largest European outbreak, and will take another hit from lower demand for flights from major destinations like France and Germany.

But the new restrictions will particularly batter foreign carriers like Germany’s Lufthansa (DE:) and Air France KLM SA (PA:) that dominate the market for flights between mainland Europe and the United States and had already grounded dozens of planes, analysts said.

“The ban on flights on Europe will really zap foreign carriers,” said independent aviation analyst Mike Boyd of Boyd Group International.

He said the U.S. embargo makes sense, because European Union countries and carriers did not sufficiently restrict China access, which allowed the virus to spread.

“We have to close the door,” Boyd said.

“This is not a drill – the epidemic is real – and unprecedented. It is the type of hard decisions the U.S. needs to make … the EU has not moved aggressively to limit the spread of this … virus,” he said.

Lufthansa and Air France KLM did not respond immediately to a request for comment.

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