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JetBlue's CEO said the fallout from the coronavirus outbreak is worse than after 9/11. Here's what airlines did then, and what they're doing now.

March 12, 2020
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An American Airlines airplane sits on the tarmac at LAX in Los Angeles, California, U.S., March 4, 2019. Picture taken March 4, 2019. REUTERS/Lucy Nicholson/File PhotoAn American Airlines airplane sits on the tarmac at LAX in Los Angeles, California, U.S., March 4, 2019. Picture taken March 4, 2019. REUTERS/Lucy Nicholson/File Photo
An American Airlines airplane sits on the tarmac at LAX in Los Angeles

Reuters

  • Airlines have been hit hard by the coronavirus outbreak, from travel restrictions to consumer fears. 
  • JetBlue CEO Robin Hayes recently said that the demand for flights has fallen more from the coronavirus than it did after 9/11. 
  • Here’s what airlines did after 9/11, and how that could inform what they do during the coronavirus pandemic. 
  • Visit Business Insider’s homepage for more stories.

President Donald Trump on Wednesday announced the US was banning most flights from Europe to the states in an effort to stem the spread of COVID-19, the disease caused by the coronavirus.

Airlines have been hit harder by the coronavirus outbreak than they were after 9/11, according to JetBlue CEO Robin Hayes. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Hayes said on CNBC that the airline industry was hit by a 30% decline in demand from August 2001 to October 2001.&nbsp;” data-reactid=”25″>Hayes said on CNBC that the airline industry was hit by a 30% decline in demand from August 2001 to October 2001. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Southwest Airlines CEO Gary Kelly also told CNBC that the decline in demand from the coronavirus outbreak is similar to that in 2001, saying that "it has a 9/11-like feel."&nbsp;” data-reactid=”26″>Southwest Airlines CEO Gary Kelly also told CNBC that the decline in demand from the coronavirus outbreak is similar to that in 2001, saying that “it has a 9/11-like feel.” 

Here’s how airlines were impacted after 9/11, what they did, and what they’re doing now to handle the fallout from the coronavirus pandemic. 

Flights were grounded on 9/11

Stranded At AirportStranded At Airport
Stranded At Airport

Thomas Lohnes / Stringer/ Getty Images

On 9/11, travelers were stranded when all flights were grounded immediately.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Fears of a similar scenario happened on Wednesday when President Trump said that all travel would be banned from Europe, though his remarks were later clarified that US citizens and permanent residents were exempt from the ban.&nbsp;” data-reactid=”43″>Fears of a similar scenario happened on Wednesday when President Trump said that all travel would be banned from Europe, though his remarks were later clarified that US citizens and permanent residents were exempt from the ban. 

 

Demand took a big hit

Southwest airport gate ticket customers travelersSouthwest airport gate ticket customers travelers
Southwest airport gate ticket customers travelers

Sandy Huffaker/Getty Images

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Airlines experienced a decline in passengers for 12 straight months after 9/11, according to a report by Barron’s.&nbsp;” data-reactid=”59″>Airlines experienced a decline in passengers for 12 straight months after 9/11, according to a report by Barron’s

It took them 22 months of growth to get back to pre-9/11 levels. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="From August 2001 to October 2001, demand declined by 30%, according to JetBlue CEO Robin Hayes.&nbsp;” data-reactid=”61″>From August 2001 to October 2001, demand declined by 30%, according to JetBlue CEO Robin Hayes

Low-cost carriers gained ground after 9/11

JetBlue Airways baggageJetBlue Airways baggage
JetBlue Airways baggage

Chris O’Meara/AP

As airlines dealt with the fallout in the years after 2001, low-cost carriers gained ground in the airline industry. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Low-cost carriers went from having 12.3% of market share in 2001 to 18.1% in 2003, according to analysis from the Business Travel Coalition.&nbsp;” data-reactid=”77″>Low-cost carriers went from having 12.3% of market share in 2001 to 18.1% in 2003, according to analysis from the Business Travel Coalition

 

Some airlines merged

southwest airlinessouthwest airlines
southwest airlines

Scott Olson/Getty Images

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The ramifications were felt for years after 9/11. United and Continental merged in 2010, and low-cost carriers Southwest and AirTran merged as well.&nbsp;” data-reactid=”95″>The ramifications were felt for years after 9/11. United and Continental merged in 2010, and low-cost carriers Southwest and AirTran merged as well

Now, demand is declining again

jetblue airport terminal empty planejetblue airport terminal empty plane
jetblue airport terminal empty plane

Flickr/Timothy Boyd

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Airlines around the world are hurting from decreased demand. United Airlines said on Tuesday that it has experienced a 70% decline in demand for domestic flights, and that it will cut flights in the coming months.&nbsp;” data-reactid=”110″>Airlines around the world are hurting from decreased demand. United Airlines said on Tuesday that it has experienced a 70% decline in demand for domestic flights, and that it will cut flights in the coming months. 

Some airlines might go out of business

korea air.JPGkorea air.JPG
korea air.JPG

REUTERS/Kim Hong-Ji

Korean Air said that it might go out of business because of the coronavirus pandemic. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Reuters reported that in a note to employees, the company’s president, Woo Kee-hong, said that "if the situation continues for a longer period, we may reach the threshold where we cannot guarantee the company’s survival."&nbsp;” data-reactid=”126″>Reuters reported that in a note to employees, the company’s president, Woo Kee-hong, said that “if the situation continues for a longer period, we may reach the threshold where we cannot guarantee the company’s survival.” 

Korean Air has grounded around 100 of its 145 passenger aircraft, according to the report. 

Airlines are asking for help

air traffic controlair traffic control
air traffic control

AP Photo/Cliff Owen, File

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Airlines were recently granted a waiver by the Federal Aviation Administration, according to a report by CNN.&nbsp;” data-reactid=”142″>Airlines were recently granted a waiver by the Federal Aviation Administration, according to a report by CNN

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The waiver allows airlines to stop running "ghost flights" — costly, empty flights — that were used to keep essential slots for takeoff and landing.&nbsp;” data-reactid=”143″>The waiver allows airlines to stop running “ghost flights” — costly, empty flights — that were used to keep essential slots for takeoff and landing. 

Airlines could recover more quickly than after 9/11, though the path forward is uncertain

airplane takeoff airportairplane takeoff airport
airplane takeoff airport

jeremybailey/Flickr

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Airlines could recover more quickly than after 9/11, according to Helene Becker, an analyst at Cowen quoted in the Barron’s report.&nbsp;” data-reactid=”158″>Airlines could recover more quickly than after 9/11, according to Helene Becker, an analyst at Cowen quoted in the Barron’s report

She noted that airlines in China are already starting to recover, but that airlines more reliant on business travel, like American Airlines and Delta Airlines, could experience a longer recovery as the economy struggles. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Read the original article on Business Insider” data-reactid=”160″>Read the original article on Business Insider

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