A dramatic scene on an airport tarmac in San Jose, Calif., shifted from panic to confusion Tuesday night, as health officials released passengers who were hospitalized after it was feared they contracted the SARS virus on an American Airlines flight from Tokyo.
Late Tuesday, the airline's parent company,
, issued a statement quoting California health officials that three passengers were not infected with a deadly respiratory virus known as severe acute respiratory syndrome. The
San Jose Mercury News
reported that the passengers were released after doctors couldn't reach a consensus on their condition.
But while AMR officials were relieved, the scare underscores the fragility of an industry reeling from Sept. 11, rising oil costs, labor disputes and the war in Iraq.
A number of
American tech companies have restricted travel to and from Asia, or have banned it outright, said a spokeswoman for the American Electronics Association.
"This is just one thing after another for the industry," said Jim Corridore, stock analyst as Standard & Poor's. "And after the war in Iraq started, perhaps the only area where people would travel without worry was the Asian region."
In Tuesday's incident, three passengers, two in their 70s and one age 50, were removed from American Airlines Flight 128 after they complained of symptoms similar to those of the sometimes deadly virus that originated in Asia. Although the aircraft was kept on the ground for several hours, the other 122 passengers were cleared to go home, and no employees reported symptoms.
Later that evening, AMR released a statement, quoting California health officials, that no one on the plane had contracted SARS. The AMR statement quoted Dr. Karen Smith, assistant health officer for Santa Clara County, Calif. "They do not fit the criteria for SARS," she said. "Nobody on that plane had suspect SARS."
SARS, which has been blamed for 62 deaths and has infected more than 1,800 people in 17 countries, has caused a global panic, causing flight cancellations and shaking the economies of Asia.
According to the Air Transport Association, advance bookings for travel were down 40% after one week of war, with airlines drastically cutting back capacity overseas to meet the reduced demand. The problem is so pernicious that on some flights carriers are seeing more cancellations than bookings.
During the last Gulf War, international travel fell by 24% -- bad enough that the largest players on the international scene, notably Pan Am, went bankrupt.
For companies such as
and American Airlines, fear of SARS may impact earnings. Northwest, which has 40% international capacity, is the airline most likely to feel the effects first, followed by Continental, with 39%, and American, at 30%. Delta is 22% international.
Oddly, the SARS scare happened on a day when shares of AMR jumped 90 cents, or 43%, to $3. The company's stock rose primarily on recent signals that the industry's
bankruptcy reorganization plans have been a boon to three ailing carriers.
Airports outside of the U.S. also are quarantining planes and passengers, with New Zealand considering a ban on tourism from outside the country and Australia forcing pilots to declare if passengers feel ill before they land.
Health officials in Florida recently told the
that it is a matter of when, not if, SARS shows up. At a convention last week in the Orange County Convention Center, health officials there were on alert for any signs of sickness, because close to 200 of the vendors were from China. Three were from Hong Kong, which has become the epicenter of the disease, with 530 reported cases.
Since November, international destinations have been one area where carriers have been able to boost prices, lifting the average price from $373.34 to $396.57 -- a 6.2% gain in four months. In February, according to ATA stats, the average cost of an international flight was $396.57, up 4.2% from last year's levels, while the average cost of a domestic price was $123.33, down 5.3%.
And with the lucrative, summer European travel season approaching, SARS could not have come at a worse time. Carriers have been extremely protective of their fare prices for summer travel, refusing to cut prices, but now if demand falls due to SARS, they'll sacrifice their profit margins in order to fill those planes. Either that, or they'll have to drastically cut capacity.
SARS "will definitely have an impact on travel to Asia," said David Stempler, president of the Air Travelers Association, a group representing large travel purchasers. "We know of a number of companies banning travel to Asia. And there may even be a problem with airline employees, especially flight attendants, who have complained to us. It could create some staffing issues. Concerns are stretching far and wide. We've spent most of the day on this, taking calls from our members."