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Travel industry grapples with cancellations, changes amid COVID-19 outbreak
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In response to the spread of COVID-19, Delta reduced service to South Korea last week, while United announced it’s limiting service to Japan, Singapore and Seoul, citing a 75% decline in demand for trans-Pacific routes. The International Air Transport Association took data from the SARS outbreak in 2003 and calculates the disease will cost the airline industry $30 billion.
Travel agent John Dekker at the Los Angeles-based Surf City Travel said he’s been tracking lost revenue from flight cancellations for about a week.
“We figured we’ve lost about $65,000 on commissions that we would have earned,” Dekker said. “For a smaller agency that we are, that’s a lot of money.”
If there are enough cancellations, airlines start reconsidering whether the cost of flying is worth it.
“If you don’t have passengers on that plane, if you don’t have cargo being shipped and the revenue coming in from that, it makes no sense to operate a flight,” said Henry Harteveldt, president of Atmosphere Research Group.
Charles Leocha, president of Travelers United, said consumers can purchase travelers insurance, but many policies don’t cover epidemics.
“The No. 1 thing you have to do is read the policy,” Leocha said.
Insurance companies do offer cancel-for-any-reason plans, but, Leocha said, they’re often expensive.
COVID-19 Economy FAQs
Are states ready to roll out COVID-19 vaccines?
Claire Hannan, executive director of the nonprofit Association of Immunization Managers, which represents state health officials, said states have been making good progress in their preparations. And we could have several vaccines pretty soon. But states still need more funding, she said. Hannan doesn’t think a lack of additional funding would hold up distribution initially, but it could cause problems down the road. “It’s really worrisome that Congress may not pass funding or that there’s information circulating saying that states don’t need additional funding,” she said.
How is the service industry dealing with the return of coronavirus restrictions?
Without another round of something like the Paycheck Protection Program, which kept a lot of businesses afloat during the pandemic’s early stages, the outlook is bleak for places like restaurants. Some in the San Francisco Bay Area, for example, only got one week of indoor dining back before cases rose and restrictions went back into effect. Restaurant owners are revamping their business models in an effort to survive while waiting to see if they’ll be able to get more aid.
How are hospitals handling the nationwide surge in COVID-19 cases?
As the pandemic surges and more medical professionals themselves are coming down with COVID, nearly 1 in 5 hospitals in the country report having a critical shortage of staff, according to data from the Department of Health and Human Services. One of the knock-on effects of staff shortages is that people who have other medical needs are being asked to wait.
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