Airline shares sink on new law threatening £5,000 fines for holiday travel
Shares in British Airways owner IAG, Easyjet, Tui, Wizz Air and Intercontinental Hotels were knocked for a second day as the government signalled a new law to fine English holidaymakers up to £5,000 for travelling abroad between now and June.
Shares in British Airways owner IAG closed down 3.5 per cent to 189p.
Rival Easyjet saw shares slide 3.9 per cent to 904p by the end of the trading day. Fellow budget flier Ryanair dipped 3.2 per cent at €15.44, while holiday giant Tui closed trading 3.6 per cent lower to 363p.
Anyone trying to leave England to travel abroad without “good reason” could be hit with a £5,000 fine under new coronavirus laws that are due to come into force next week.
Holidays abroad are not currently allowed until 17 May under lockdown rules which come to an end on Monday, but MPs will this week vote on legislation to ban leaving the UK.
Yesterday another UK Government minister again warned Brits off booking summer holiday travel abroad.
Helen Whatley, the social care minister said rising Covid-19 infection rates in Europe added to uncertainty that UK arrivals would be allowed to travel freely this summer.
“My advice would be to anybody right now is just to hold off on booking international travel,” she told the BBC.
“It just feels pre-mature to be booking international holidays at the moment.”
Her comments came after defence secretary Ben Wallace refused to rule out an extension to the existing ban on international travel beyond 17 May.
That came after a government adviser said the risk of variants to the UK could mean a delay to holidays abroad.
Dr Mike Tildesley, a government adviser, gave warning over the weekend that summer holidays in other countries were “extremely unlikely” because of the risk that UK tourists bring back new Cobid strains.
Other handbrakes on the resumption of international travel include when and how the European Union launches its Covid-19 health certificate, a vaccine passport that will also show if a traveller has a negative test of antibodies that mean they are a low-risk arrival at the border.
An expected slowdown in vaccination rates in the UK in April is also dampening prospects of a swift return to summer holidays in Europe.
But travel companies and aviation bodies hit back at the negativity, with Airlines UK saying that it was “too early” to make such a call.
“Our focus between now and then must be working with Ministers on a framework for travel that is robust and workable, and can stand the test of time as we enter the all-important summer period”, said chief executive Tim Alderslade.
“We have always said any reopening must be risk-based, but also led by the overriding assumption that as the vaccine rollout accelerates both here and abroad, a phased easing of restrictions is achievable.
“We know that universal, restriction-free travel is unlikely from 17 May but under a tiered system, based on risk, international travel can meaningfully restart and build up, with minimal restrictions in time.”
And another government adviser also said this morning that ministers were mulling a “traffic light” system to enable travel to get going again.
UCL Professor Andrew Hayward, a member of the Nervtag advisory group, told the BBC: “I suspect what we may end up with is some sort of traffic light system with some countries that are no-go areas, for example likely to be South Africa and South America; other areas where there will be more severe restrictions, there will be some combination of vaccine certificates, testing and maybe quarantine, and maybe there will be some low-risk countries that you can go.”
Michael Hewson, chief market analyst at CMC Markets said: “While the prospect of a big European restart on the summer holidays front was always a long shot, events over the weekend have made the prospect even more remote, as the prospect of a third wave across Europe pushes the prospect of any sort of economic restart into the back end of the second quarter”