International airlines are reportedly preparing to combat the emerging threat posed by the new variant of coronavirus, Omicron, which might compel them to modify destinations and schedules on short notice and gravitate more towards domestic markets.

Although many passengers have already booked trips for the Christmas holiday season, which is a prime time for airlines, mounting concerns about a slowdown in future reservations and further delays to the already sluggish business travel segment might cause a hindrance.

With the advent of new variants such as Omicron, airline conditions will remain uncertain. However, due to the diverse nature of worldwide airlines and the economic structures, Omicron's impact will vary from country to country.

Gulf hub airlines acted speedily to protect their hubs by restricting passenger travel from Southern Africa, fearing the spread of new variants would result in restrictions beyond the initially affected regions.

Whereas, airlines in nations like the United States, China, and Russia, which possess large and strong domestic markets are better protected from the unpredictable nature of foreign travel.

It is worth noting that, despite U.S. restrictions on non-citizens entering the country from South Africa, United Airlines UAL.O began its Newark-Cape Town service on 1st December, meanwhile, Delta Air Lines DAL.N has reported a high number of bookings during the Christmas season.

Major European airlines rely on foreign travel more than their American counterparts, putting them at greater risk from the Omicron variant. The United Kingdom has tightened its immigration testing standards due to a drop of 26% in international travel searches as compared to only a 5% drop in the United States’ foreign travel searches.

In the Asia Pacific region, countries like Australia, Singapore, Japan, and Thailand, which had recently begun to cautiously lift cross-border movement bans, observed passenger numbers far below the pre-pandemic levels even before the Omicron variant was discovered.

Experts cite that every new coronavirus variant has led to a drop in airlines reservations, followed by an upsurge once the spike passes which is expected to be the case this time as well.

Source: https://www.nasdaq.com/articles/global-airlines-prepare-for-omicron-induced-volatility