While China accounts for nearly half of the losses in the global business travel sector to date, the coronavirus impact on the sector is likely to deepen as more companies in the U.S. and Europe nix travel in the days ahead.
The global business travel sector is expected to take a revenue hit of about $820 billion, with China accounting for nearly half of the losses, as corporates curb travel plans in the face of the coronavirus epidemic, an industry body said on Tuesday.
Business travel to Asia has been the worst hit, with at least three out of every four companies reporting they have canceled or suspended all or most business trips to China, Hong Kong, Taiwan and other Asia-Pacific countries, according to a survey by Global Business Travel Association (GBTA).
The industry group’s latest estimate is sharply above its February forecast of a $560 billion hit.
The fast-spreading virus, which originated in the central Chinese city of Wuhan, has killed more than 4,000 people, mostly in China, while disrupting businesses globally.
“Coronavirus is significantly impacting the business travel industry’s bottom line,” GBTA Chief Operating Officer Scott Solombrino said in a statement.
“The impact to the business travel industry – and to the broader economy – cannot be underestimated.”
China, which has seen a 95 percent drop in business travel since the outbreak, is expected to lose $404.1 billion in revenue from corporate travel, followed by $190.5 billion in loss for Europe.
Airline and hotel industries, which typically are the biggest beneficiaries of corporate spending, have taken a major hit to their revenue as the virus continues to spread, the industry group said.
Reporting by Bhargav Acharya in Bengaluru; Editing by Anil D’Silva)
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Photo credit: A man wearing a face mask passes by empty ticket counters at the Daegu Airport in Daegu, South Korea. The coronavirus outbreak has caused a sharp slowdown in global business travel as more companies suspend or cancel travel due to Covid-19 concerns. Kim Hyun-tae / Associated Press