On Lake Como in northern Italy, spring normally spells the return of the tourists. The likes of George Clooney descend on waterfront villas, couples wander the cobbled streets and design fairs fill hotel rooms with well-heeled travelers. This year, because of the coronavirus, hoteliers are wondering whether the visitors will come at all.

Hotels in the area saw more than half their bookings canceled in three days last week as the virus spread through northern Italy in the biggest outbreak outside Asia. Now innkeepers are waiting anxiously to see the impact on the all-important summer months.

“We had our ups and downs in the past, but nothing like this,” said Roberto Cassani, 58, president of the Como hotel operators’ association. “American tourists in particular seem to be victims of a collective psychosis. I am really worried.”

As an illness that broke out in China goes global, the tourism business faces a growing threat. Many of the Chinese travelers who have driven the industry’s expansion were already staying home, after the government locked down tens of millions of people and banned sales of package tours. That emptied lodgings in the casino hotspot of Macau, cleared beaches across Southeast Asia and eliminated lines outside Louis Vuitton boutiques in Paris.

Even as the viral spread slows in China, it’s taking off elsewhere, including South Korea and Italy, which together have reported more than 8,000 of the global total of some 93,000 cases. Now it’s not just Chinese who are staying home. Germans and Belgians are rethinking ski trips to Italy. Japanese are canceling visits to Bali. At stake is the $1.7 trillion in revenue that international tourism generated in 2018, according to the UN World Tourism Organization.

Many business travelers who normally fill the travel industry’s slack during the winter months are staying home, too, as companies like Facebook Inc. and Google trade face-to-face meetings for webcasts. The likes of L’Oreal SA, Nestle SA and Cargill Inc. have suspended employee travel globally for the coming weeks. Authorities have axed trade fairs that would have drawn hundreds of thousands to Berlin, Geneva and Barcelona, while Hawaii’s Festpac cultural festival was canceled.

The Global Business Travel Association says the coronavirus could cost the industry some $47 billion per month. Airlines and package tour operators have painted an equally gloomy picture, with the International Air Transport Association predicting almost $30 billion in lost flight sales.

“We aren’t capable of saying how long the situation will last,” said Ana de Pro, chief financial officer of Amadeus IT Group SA, which provides online booking software for the travel industry. Package holiday giant TUI AG announced a hiring freeze, saying it can’t yet estimate the financial fallout from the outbreak.

It’s the biggest setback for the travel industry since a downturn that accompanied the 9/11 terrorist attacks in 2001 and the SARS outbreak and the war in Iraq two years later. Airlines, tour operators and hotel companies were already wrestling with a shift in how people travel, thanks to the rise of online bookings and discount carriers. Rising passenger numbers, including millions of new travelers from China, had cushioned the blow for airlines, which relied on rapid consolidation to fuel profit growth. Now they’re lurching toward a crisis.

While Chinese flights are resuming after much of the country’s air traffic was grounded earlier this year, fallout is spreading in Europe and elsewhere. Deutsche Lufthansa AG and British Airways parent IAG SA issued profit warnings over the coronavirus, while EasyJet Plc and Ryanair Holdings Plc have canceled services and Italian carrier Alitalia SpA laid off 4,000 workers temporarily. Some ticket-holders for flights are simply not turning up, the air transport association said.

First « 1 2 3 » Next