American Airline Group (AAL) - Get Report shares slumped lower Thursday, pulling rivals deeper into the red, after an airline lobby group said global carriers could lose more than $100 billion in revenues this year amid the coronavirus outbreak
The International Air Transport Association, also known as IATA, said carriers around the world could lose between $63 billion and $113 billion in passengers revenues this year, depending on the depth of the cororanvirus pandemic, as business and leisure demand plunges and government travel restrictions increase.
“The turn of events as a result of COVID-19 is almost without precedent. In little over two months, the industry’s prospects in much of the world have taken a dramatic turn for the worse," said IATA director general Alexandre de Juniac. "Airlines are doing their best to stay afloat as they perform the vital task of linking the world’s economies. As governments look to stimulus measures, the airline industry will need consideration for relief on taxes, charges and slot allocation."
American Airlines shares were marked 8.1% lower in early trading Thursday to change hands at $17.03 each, a move that would extend the stock's one-month decline to around 45%.
Airline executives met with President Donald Trump in the White House Wednesday to discuss the industry's challenges during the coronavirus outbreak which has spread to 70 countries around the world and 17 U.S. states.
"It's affecting the airline business, as it would," Trump told reporters in Washington. "And a lot of people are staying in our country and they're shopping and using our hotels in this country, so from that standpoint I think probably there's a positive impact, but there's also an impact on overseas travel which will be fairly substantial."
However, both U.S. Chamber of Commerce head Tom Donohue, as well as U.S. Travel Association chief Roger Dow, insisted the industry would not need government support to weather the coronavirus crisis.
"We don't need any bailouts here," Donohue said. "Bottom line is we're going to run just like business as usual - with a little higher heartbeat and get it done."