Hotels, airlines to suffer over bombs
Published 23/03/2016 | 02:30
Airlines and hoteliers will be among the businesses most immediately affected by the Brussels terror attacks.
The financial cost to the aviation and hotel sectors could run to hundreds of millions of euro.
While investors in airlines such as Ryanair and Aer Lingus owner IAG saw their shares decline on the back of the horrific events yesterday, the impact also feeds through the financial performance of the carriers.
Following the Paris attacks last November, Ryanair said it noticed weak bookings immediately after.
Air France-KLM said the Paris attacks cost it €70m in lost revenue.
"It is extremely difficult to determine the impact of such an unprecedented event," said analyst Jack Diskin of Goodbody Stockbrokers regarding yesterday's events in Brussels.
"However, historically speaking, travel flows to major European cities are resilient. In the case of last November's Paris attacks, Air France noted a progressive recovery in its bookings within two months, following a temporary slump in tourism traffic into Paris."
Also, because it's the centre for EU institutions and not as big a tourism destination as Paris, the impact on air traffic to Brussels might not even be as stark.
Aer Lingus owner IAG noted that its so-called group passenger unit revenue - a key measure of an airline's performance - in the last quarter of 2015 when the Paris attacks occurred was 3.7pc lower.
Immediately following the Paris attacks, Aer Lingus was reporting cancellations of up to 50pc on flights to the city.
A spokesman for Aer Lingus said yesterday its flights to Brussels today are cancelled. The airline is offering money back to passengers booked to fly to Brussels between yesterday and March 31.
Apart from the airlines, hotels will also be bracing for a financial hit. A January report from research firm MKG showed that French hoteliers could lose up to €270m between last November and this month as a result of the Paris attacks.