Boeing, airline shares collapse as new Covid variant slows travel
Passengers, wearing face masks, walk through the International Arrivals Hall after arriving at Terminal 2 at London Heathrow Airport.
Simon Dawson | Bloomberg | Getty Images
Boeing and other travel stocks fell in pre-market trading on Friday after several European and Asian countries announced new travel restrictions from southern Africa due to a new variant of Covid.
The UK said on Thursday it would temporarily suspend flights from South Africa, Namibia, Lesotho, Eswatini, Zimbabwe and Botswana. France and Italy have announced restrictions on entry from the region. The European Commission has recommended a break on travel between the EU and southern Africa.
The new restrictions highlight how quickly authorities can limit travel when new variants of Covid-19 are detected.
They come just as many airlines and aircraft manufacturers like Boeing were optimistic about a rebound in travel demand.
Travel and aerospace stocks fell more than the overall market on Friday. Boeing shares are down more than 6% in pre-market trading, while Delta Air Lines is down 7% and United Airlines is down 8%. American Airlines lost almost 8%. Hotel giant Hilton was down 5% before the market opened.
âFollowing the Secretary of Health’s latest announcement, we are working on plans for our customers and colleagues currently in South Africa and those due to travel from the UK in the coming days,â said British Airways, a partner. American Airlines, in a statement. . The carrier said it would contact customers affected by the changes.
Delta’s transatlantic partner Virgin Atlantic has said it will have to cancel flights from Johannesburg from Friday to Sunday morning due to new UK rules.
State Department and White House did not immediately comment on potential travel restrictions to the United States
On November 8, the Biden administration lifted a broad pandemic travel ban on most non-nationals from more than 30 countries, including the UK, EU, South Africa and Brasil.
Although domestic travel has largely recovered from the first pandemic lockdowns, international travel has remained a missing piece in the airlines’ recovery.
On Wednesday, the day before Thanksgiving in the United States and generally one of the busiest travel days of the year, the Transportation Security Administration has screened more than 2.3 million people. It was the highest since February 2020, although still 12% lower on the same day in 2019.
–CNBC’s Matt Clinch contributed to this article.