Travel shares slide as Britons warned not to book foreign holidays | Travel & leisure

Shares in travel and aviation businesses including the British Airways owner, IAG, easyJet and the

Shares in travel and aviation businesses including the British Airways owner, IAG, easyJet and the aero engine maker Rolls-Royce tumbled on Monday after the government warned the public not to book holidays abroad this summer.

Investors took fright at the thought that the struggling airline and travel sectors could face another summer of lost bookings, as continental Europe struggles with the rollout of vaccine programmes.

Shares in IAG, easyJet, and the package holiday company Tui all lost around 5%, while the Jet2 airline fell almost 7%. Rolls-Royce ended more than 4% lower.

The negative outlook wiped off some of the strong gains made at travel-related businesses since the government announced its “cautious but irreversible” roadmap out of lockdown on 22 February.

While pandemic restrictions mean overseas holidays are banned, under Boris Johnson’s roadmap the government had previously said they could resume as soon as 17 May.

However, after warnings over the weekend from scientific experts that allowing summer holidays could risk another lockdown, ministers struck a more cautious tone than before in Monday morning broadcast interviews, prompting the airline and travel sector sell-off.

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“My advice to anybody right now is just to hold off on booking international travel,” the social care minister, Helen Whately, told the BBC. “It just feels premature to be booking international holidays at the moment.”

Last week, the UK hit the milestone of half of all adults having received at least one dose of the Covid-19 vaccine. However, much of Europe is still struggling to get to grips with the pandemic, hampered by the slow rollout of vaccine programmes, rising infection rates and the impact of new variants.

While some flights for May and June have been cancelled, changes and cancellations have been ongoing since restrictions were announced in January.

EasyJet’s chief executive, Johan Lundgren, told an aviation conference he always expected there to be bumps along the way to a travel recovery and denied that a third wave of Covid-19 infections in Europe put it at risk.

“I never thought that this was going to be a straight line,” he said, but he added he was convinced there was light at the end of the tunnel.

A spokesperson for travel association ABTA said there had “been much speculation”, but added: “We believe international travel will be able to restart in a way that manages risk through various mitigations.”

Tim Alderslade, chief executive of Airlines UK, the industry association representing UK-registered carriers, said: “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.”

The government is believed to be considering a “traffic-light” system where some destinations would be off-limits, others require quarantine, and some allow travel without restrictions. The taskforce is due to publish its recommendations on 12 April.