U.S.-based travel agencies reported a 21% increase in passengers canceling flight plans this week compared to a year ago -- a behavioral shift apparently spurred by the continuing spread of the COVID-19 coronavirus.
This is according to a new report out of Stamford, Connecticut-based Vertical Research Partners, which included a series of other disturbing facts for the travel industry:
- The dollar value of trips sold by U.S. travel agencies this week was down 9.4% year over year.
- A week ago, that metric was down 5.4%.
- For February, ticket sales were about 4.4% below where they were in February 2019.
Other countries have it even worse. In China, reports MarketWatch, citing the Vertical report, more people are now canceling trips they've already paid for than are booking new ones. Travel sales in the near-China markets of Japan, Korea, and Southeast Asia are down by 60% to 75% year over year. All around the globe, in fact, tourism sales are "weak" -- even in places still mostly untouched by COVID-19, such as Scandinavia.
(In fact, though, there have now been more than a dozen confirmed cases of COVID-19 in Denmark, Finland, Norway, and Sweden).
While China appears to be getting a handle on containing the outbreak, COVID-19 is evolving into a global problem as diagnoses surge elsewhere: More new cases of the coronavirus were confirmed in South Korea Friday than in China, and there was a more than 20% increase in reported cases in Germany, for example.
Unsurprisingly, airline stocks were taking it on the chin Friday morning: American, Delta, and United (NASDAQ:UAL) were all down by more than 2%. United just announced it is cutting flights to Southeast Asia due to falling demand -- and its share price was down by 2.4% as of 11:21 a.m. EST.