Coronavirus outbreak | As tourism takes a hit, travel companies halt hikes, freeze hiring

Forbidden City, Beijing, China after coronavirus (File image)

The tourism sector is facing the brunt of novel coronavirus, or COVID-19, with travel and aviation companies deferring salary hikes, cutting costs and freezing hiring, Business Standard reported.

International bookings to Southeast Asia and Europe, in particular, were hit the most, and more cancellations are expected as the latter is a popular summer-time destination, the report said.

Spike in cases in Italy, South Korea, Japan, Iran, among others have caused worldwide travel bans, visa and flight cancellations and closing of borders, which has crippled companies.

Thomas Cook informed staff it has held back increments in view of 'unpredictable market conditions' and in a share buyback notification last month stated that a “sluggish economy and difficult trading conditions due to coronavirus has resulted in slowing demand.”

The Akbar Group has initiated a hiring freeze, “except where absolutely essential,” COO Amey Amladi told the newspaper.

While Expedia is laying off 3,000 employees, starting from Hong Kong and Singapore.

Stic Travel Group has halted infrastructure upgrades and office improvement works, the article quotes Director Isha Goyal as saying.

Among airlines, the International Air Transport Association (IATA) estimates a $30 billion revenue loss, with Chinese carriers bearing the brunt. Singapore Airlines has announced a 5-15 percent salary cut for all employees – CEO and management included, while Emirates is offering voluntary leave without pay. Both are cutting costs and have halted fresh bookings, the paper said.

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For Indians in particular, Italy – which has recorded the highest number of COVID-19 cases in Europe – is a summer favourite. But the government has issued a travel advisory to 'curb all non-essential travel' to the country.

“As we head towards the peak summer season, we anticipate a drop of 12-15 percent in bookings,” Sabina Chopra, co-founder, Yatra.com, told the paper.

A MakeMyTrip spokesperson told the paper that they expect a 'definite slowdown in outbound travel bookings' and expect a potential impact if the outbreak spreads westwards. The company’s outbound business is 20 percent of its entire operation. They, however, added that domestic bookings have not seen any 'noticeable dip'.