Airlines & Travel Agencies Lose Up to €2 Billion Due to Newly Introduced Travel Restrictions in Austria

Concerns over the introduction of new restrictions across the EU have caused British airlines and travel agencies to lose over €2 billion last week, as the Austrian government announced a national lockdown due to increasing COVID-19 positive cases.

Other EU countries, potentially Germany, may impose similar rules to its citizens and international arrivals, which would affect the travel and tourism sector significantly, reports.

According to the Guardian, IAG, the owner of British Airways, fell by 3.8 per cent, losing almost €356 million of the company’s market capitalization. However, the markets with the biggest losses on the FTSE 100 included Rolls-Royce, which dropped by almost four per cent, in addition to Germany-based entities Whitbread and Intercontinental Hotels group.

Other businesses affected by negative investor sentiment also include the airlines EasyJet, Ryanair, Lufthansa, and Wizz Air, as well as Tui and Carnival operators.

“Surging case numbers [in Austria] have far surpassed last year’s peak. While fatalities remain well below the peak, they are accelerating and the government is clearly keen to arrest it before the situation potentially becomes much worse. With Germany seeing a similar trend, the question now becomes whether the region’s largest economy will follow the same path,” Craig Erlam, a senior market analyst at the trading company Oanda, told the Guardian.

Last week, German authorities noted that the country was facing a national emergency, and they were considering a national lockdown option to prevent the further spread of COVID-19.

He also noted that the situation remains calmer in other countries like France, Italy, and Spain, but that could change in the upcoming days, as witnessed last year. Higher vaccination rates mean that the incidence rates and deaths caused by COVID-19 are lower, but the number of cases increasing is hard to ignore.

Following statements of German representatives and the increasing number of COVID-19 cases, the United States warned its citizens not to travel to Germany for the time being, issuing a “Level Four: Do Not Travel” advice. In addition, the Czech Republic was also quick to react as its authorities had already added Germany to its dark red category.

The World Health Organisation (WHO) data shows that Germany has reported 340,509 positive cases with COVID-19 in the last seven days, in addition to 1,409 deaths related to the virus.

High rates of infection incidences are also reported in Austria, as 98,301 positive cases were registered in the last week and 11,606 fatalities. More than half of the population in both countries is fully vaccinated; 67.55 of persons out of 100 in Germany and 63.85 in Austria.

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