Airlines in Asia Hard Hit by SARS

Major airlines in Asia have been hard hit by SARS (Severe Acute Respiratory Syndrome).

The Nihon Keizai Shinbun reported on April 27 that 12 airlines in Hong Kong, Singapore, Japan, and Korea suspended over 1,000 flights for the week.

Headquartered in SARS-stricken Hong Kong, Cathay Pacific cut 45 percent or 218 flights on Sunday as the SARS outbreak reduced demand for air travel. Business performance has worsened and stock prices are declining as a result.

Most airlines reduced flights to Europe and America and Southeast Asia as well as China, Hong Kong and Taiwan. Garuda Indonesia Airways, where no SARS infections have yet been reported, also suspended 30 flights. According to Reuters, major Chinese airlines also cut operations by at least 30 percent.

With performance deteriorating, ailing airline companies are struggling to find a way out by decreasing recruitment numbers and the purchase of new aircraft. Singapore Airlines postponed plans to employ 206 new intern cabin crew members and purchase contracts from Boeing and Airbus.

In order to absorb the effects, the Singapore government decided to offer a 30% discount on landing fees, while Taiwan announced a 15% discount from April until September.

Hun-Joo Cho hanscho@donga.com