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Heathrow issues bleak warnings as Omicron set to hamper travel sector

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·Business Reporter, Yahoo Finance UK
·3-min read
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Heathrow's Terminal 5
Heathrow airport expects to see just 45 million passengers next year, compared to a record 81 million in 2019, when it ranked as Europe's busiest hub. Photo: Adian Dennis/AFP via Getty Images

Heathrow warned on Friday that the new Omicron variant has already hit its business, with rising cancellations and declining passenger numbers.

The UK’s largest airport said that government-imposed travel restrictions across the globe was damaging passenger confidence as demand in November was 60% lower than pre-pandemic level. This was despite the US reopening its borders to fully vaccinated travellers during the month.

It also saw a high number of cancellations among business travellers who were concerned about not being able to fly home if restrictions changed and infections spread.

“The high level of cancellations by business travellers concerned about being trapped overseas because of pre-departure testing shows the potential harm to the economy of travel restrictions,” the airport said in an update.

Heathrow added that it was likely to take years for passenger numbers to return to pre-pandemic levels. It expects next year to see just 45 million passengers, compared to a record 81 million in 2019, when it ranked as Europe's busiest hub.

The news comes just days after the UK government unveiled new travel rules to prevent the spread of the Omicron, dealing a fresh blow to the sector.

Read more: UK economy slows to a crawl in October as GDP rises just 0.1%

The changes include pre-departure tests for people arriving in Britain, while 11 African countries have been placed on the red list, requiring travellers to quarantine before reuniting with families.

In addition to this, all travellers returning to the UK must take a PCR test and self-isolate until they receive a negative result.

“By allowing Brits to isolate at home, ministers can make sure they are reunited with their loved ones this Christmas,” said John Holland-Kaye, the chief executive of Heathrow.

“It would send a strong signal that restrictions on travel will be removed as soon as safely possible to give passengers the confidence to book for 2022, opening up thousands of new jobs for local people at Heathrow. Let’s reunite families for Christmas.”

Meanwhile, transport secretary Grant Shapps has said he doesn't want the red list and hotel quarantine in place "for a moment longer than necessary".

He said a time would come, "probably no more than days or a short number of weeks away", where the government would want to review and potentially remove countries from the red list.

Read more: UK business confidence hits highest level since July as Omicron threat looms

The comments echo similar warnings from aviation businesses after earlier this week TUI (TUI.L), the world’s largest package holiday operator, said bookings for winter holidays have taken a hit.

The Anglo-German company said it is now reviewing whether to cut capacity for the rest of its winter programme.

It made a loss of €2.5bn (£2.1bn, $2.8bn) in the year to the end of September, a narrower annual loss compared to the year before which stood at €3.2bn.

Watch: Should I book a holiday?

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