Cathay Pacific is among the first carriers to allow passengers to change any China travel plans in the face of the Wuhan coronavirus outbreak. It follows Beijing's request late on Thursday to all airlines to offer refunds on flights to and from the mainland.
Hong Kong's flagship carrier said on its website on Friday it would allow passengers flying to or from any mainland China airport to rebook, re-route or take a refund on any type of ticket booked up to the end of February. It is also applicable to Cathay Dragon flights.
On Thursday night, China's civil aviation regulator urged all airlines and travel agents to offer full refunds without adding any administrative fees for flights to help prevent the spread of the virus, which has killed 26 people on the mainland.
The blanket policy change is a blow to Hong Kong's flagship airline, which flies into 23 airports on the mainland, and has been suffering for months from Hong Kong's anti-government protests and a de facto boycott across the border.
Cathay's move comes as Hong Kong tightened its precautions on tackling the virus, prompting cancellations by local travel agencies on outbound tours to the mainland to pacify worried visitors.
Hong Kong's Travel Industry Council said that about 2,600 tours to the mainland between Saturday and mid-February had been cancelled, affecting more than 91,000 people and involving about 20 agencies.
Executive director Alice Chan Cheung Lok-yee said holidaymakers could get a refund according to the booking terms and conditions.
On Friday, Hong Thai Travel announced it was cancelling all outbound tours to the mainland from Saturday to January 31, affecting about 2,500 travellers from around 80 tour groups.
It said the move was taken "in consideration of the health of the staff and visitors", adding that those who signed up for their China tours could re-route within six months or seek a refund after deduction of administrative fees.
"We also encourage our frontline workers to wear masks to protect the health of our staff and customers," it said.
Sunflower Travel Service also followed suit, saying it would cancel all outbound tours to the mainland from Saturday to February 10, affecting about 3,000 travellers.
The firm's general manager Johnny So said they would reconsider the situation after February 10, and the affected travellers could re-route or seek a refund.
"This is a tough decision, but we hope to ease the mind of our customers so they don't need to worry about their journey. We've suffered losses because we already paid for the hotel bookings and other transport fees," he said.
So believed other travel agencies might have similar arrangements as a number of them had a meeting with the Travel Industry Council on Friday about travellers' concerns. "We have been getting a lot of inquiries from customers about their China tours," he said.
Wing On Travel also announced it would cancel all outbound tours to China from Saturday to February 15, saying the affected travellers could re-route within six months or seek a refund after administrative fees.
China Travel Service also cancelled all outbound tours to the mainland from Saturday to January 31, affecting about 3,500 travellers, Yeung Sai-hing, the agency's deputy general manager, said.
He said customers could choose to re-route within six months at a discount or seek a refund.
On Thursday, Cathay announced all Cathay Dragon flights from and to Wuhan, which has been locked down along with Huanggang and Ezhou, would be suspended until February 29.
The MTR Corporation also said it would stop selling high-speed train tickets to and from Wuhan, the epicentre of the outbreak.
At the West Kowloon high-speed railway station, hundreds of passengers queued for nearly two hours for refunds on tickets on Friday.
Banker Alvin Shum, 30, said he originally planned to go to Fujian with his family, but decided to cancel the trip.
"It's for our own safety. We are very worried about the outbreak on the mainland, as we are not sure how serious it is," Shum said, adding that he bought the tickets about a month ago, when there were only a few reported cases on the mainland. "There are elderly and children among us, so it could be dangerous."
Maintenance worker Kelvin So, 60, had packed his bags and was ready to visit his friends in Chongqing but changed his mind at the station. "I've just read the news about the pneumonia in Wuhan and my friends in Chongqing asked me not to come either," he said.
Others at the station planned to continue with their trips but said they would be more cautious.
A middle-aged man surnamed Ip had some doubts about visiting his hometown Chaozhou in Guangdong province with his family.
"But since we bought the tickets some time ago, we won't worry too much. I will get my masks on the train, and wash my hands more frequently."
US teacher Whitney, 27, who took the high-speed train from He Fei in Anhui to West Kowloon via Shenzhen, said it did not look tense at the border with Hong Kong. "We are not too worried, but we are going to be cautious and we won't go to places if there is an infection case," she said.
Aside from Cathay, the other airlines offering refunds are Hong Kong Airlines, China Southern Airlines, China Eastern, Air China, Hainan Airlines and AirAsia.
With passengers given the option to cancel, airlines are likely to suffer a financial hit " but it is too early to tell how large " over one of the busiest travel periods for Asian carriers.
The enforcement by the Civil Aviation Administration of China is a blow to airlines who typically cash in during the Lunar New Year period, which involves the biggest mass migration in the world.
Over the past week, as the coronavirus threat has spread, travel stocks have been battered, in particular airlines. Cathay's shares are down 8 per cent while Air China has sunk 13.8 per cent.
However, investors shrugged off the increasingly bad news on Friday as Cathay's shares gained almost 0.6 per cent, to HK$10.20.
Jefferies equities analyst Andrew Lee said mainland carriers were most exposed to the impact of the virus. "Earnings for Chinese airlines are most sensitive to passenger yields, especially domestic yields given the domestic passenger segment is the largest revenue driver," he said in a research note earlier this week.
Luya You, transport analyst at brokerage Bocom International, warned of further turbulence in airline share prices as the effects of pandemic-like scares on the travel industry were increasingly becoming comparable to the impact of the severe acute respiratory syndrome (Sars) outbreak in 2003.
"We expect passenger traffic during the Lunar New Year peak travel season to remain intact despite rising outbreak fears. Due to the relatively short timeline between news of first virus detection and Lunar New Year, we expect most travellers to preserve their travel plans. As a result, any major traffic impact stemming from a worst-case outbreak scenario may only be visible post-Lunar New Year, in our view," You said.
The cancellations came after Hong Kong reported its first two cases of the coronavirus on Wednesday, as the death toll on the mainland hit 26, among 894 confirmed cases.
The virus has spread to other parts of the world, including Thailand, Japan, and South Korea, while Macau reported its second case on Thursday, a 66-year-old tourist from Wuhan.
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