Airlines Face Delay Costs, But Won't Have to Pay Compensation, RBC Says -- Market Talk

Dow Jones07-19

1128 GMT - Airlines aren't required to compensate passengers for delays resulting from "extraordinary circumstances" but continuing disruption and delays will still impose costs on them, RBC Capital Markets analyst Ruairi Cullinane writes in a note to clients. Airlines and airports are among the businesses most affected by a global IT outage, with KLM and American carriers among the most impacted, he says. Airlines will incur costs via food, drink, accommodation and transport provisions--which they are required to provide regardless of the cause, he says. There could also be an opportunity cost to close-in bookings if passengers choose not to fly, or if airlines need to use up remaining seats redirecting passengers from canceled flights, Cullinane says. In Europe, Lufthansa, Ryanair and Wizz Air are among the airlines reporting issues, with Spanish airport operator AENA warning on delays. (adam.whittaker@wsj.com)

(END) Dow Jones Newswires

July 19, 2024 07:33 ET (11:33 GMT)

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