April 19, 2010 / 5:21 PM / 10 years ago

FACTBOX-Europe disruption hits Asia flights, supply-chains

SINGAPORE, April 19 (Reuters) - Pakistan’s prime minister cancelled a visit to Europe for an EU summit and thousands of people remained stranded at airports and hotels across Asia on Monday following flight restrictions in Europe because of a huge ash cloud. [ID:nLDE63007]

The shutdown of air cargo routes to Europe has also begun to impact on the flow of predominantly high-end exports from southern China’s Pearl River Delta, known as the world’s factory floor, officials said.

Following are details of the impact Europe’s air traffic chaos has had on several countries in Asia :

HONG KONG/SOUTH CHINA

Greg Knowler, editor of Cargonews Asia in Hong Kong, said the global supply chain had been affected and the backlog was mounting because of the cancellation of cargo flights.

“Everything (is being) pushed back down the pipeline. The forwarders are actually sending stuff back to the factories ... One German forwarder that’s based here reckons they have 4000 tons of backlog in Hong Kong.”

Knowler said some freight forwarders were now chartering flights at great cost to southern European airports like Barcelona as a contingency measure, then transporting urgent deliverables by road to northern Europe.

Hong Kong based carrier Cathay Pacific said all flights to and from Europe, except Rome and Milan, on the night of April 20 and the morning of April 21 would be cancelled

JAPAN

Fujitsu Ltd (6702.T) said its notebook PC shipments to Europe have been halted temporarily due to disruptions in European air traffic. The halted shipments are not affecting its European PC sales thanks to inventory in the region, and it expects no earnings impact at the moment, a Fujitsu spokesman said.

Sony Corp (6758.T), Sharp Corp (6753.T), Hitachi Ltd (6501.T) and Panasonic Corp (6752.T) said they were not experiencing any impact from the transport disruption.

SOUTH KOREA

The country is estimated to post $112 million in lost exports caused by the ash cloud, according to a trade association. Korean Air has cancelled a total of 15 cargo carriers between Apri 17 and 19.

“If the stoppage of flight services in Europe due to the volcanic ash cloud lasts more than a couple of weeks, it will be negative to technology exporters, as they will have problems delivering products. There is no knowing how long the situation will endure,” Kim Seong-bong, market analyst at Samsung Securities said.

TAIWAN

Taiwan’s two major international airlines have lost a total of $6 million on grounded cargo shipments bound for Europe, the island civil aviation authority said on Monday. A total of 14 Europe-bound flights from Taiwan had been cancelled since Thursday. China Airlines (2610.TW) said high-tech products and flat panels, both key to the export-dependent $390 billion economy, made up much of the cargo slated to reach Europe on its 10 cancelled flights.

PAKISTAN

Pakistani Prime Minister Yusuf Raza Gilani’s visit to Paris, Brussels and Madrid, scheduled to begin on Monday, has been put off because of the volcanic ash. The visit, during which Gilani was to attend an EU summit in Brussels, will be rescheduled in consultation with the EU and the governments of France and Spain, Gilani’s office said.

State run Pakistan International Airlines (PIA) has cancelled 65 flights resulting in revenue losses of about $8 million, airline spokesman Syed Sultan Hasan said:

INDIA

In Mumbai, India’s financial hub, stranded passengers have booked into hotels near the airport and elsewhere in the city, bumping up occupancy in what’s considered the tourist off-season.

“We didn’t mean to visit Mumbai, but here we are, and we are making a holiday of it and enjoying ourselves,” said Luis Bastos, who had been in Goa on vacation with his wife and decided to come to Mumbai for more flight options to Amsterdam

India’s national carrier Air India will resume its Mumbai-New York and Delhi-New York flights later on Monday on alternative routes, a spokesman said. Its flights to Washington remain cancelled, he said.

Top private carrier Jet Airways has received permission to operate flights to and from the United States and Canada on Monday via Athens, a spokeswoman said. Its flights through London and Brussels remain affected, she said

PHILIPPINES

There are about 25,000 travelers to Europe that are stranded in the Philippines, waiting for the European skies to clear from volcanic ash.

“Lucky for me, I have my laptop and I could still do some work,” David Hampson, a humanitarian worker from Manchester, England, told reporters while waiting for a KLM flight at Manila’s international airport.

KLM, which has has four flights cancelled since April 16, has about 1,600 passengers on its waiting list, Joan Doromal, station manager, told Reuters, saying the list is growing longer every day.

SINGAPORE

Anita Gupta, Asia-pacific spokeswoman for DHL in Singapore, said the company was adjusting its air and ground networks swiftly to process shipments in the affected regions using available transport modes. It has increased its trucking capacity to minimize delays for shipments within Europe. A 3 to 5 day delay is expected for shipments moving between Europe and the rest of the world.

“All shipments between non-European destinations have not been affected. DHL is closely monitoring the situation and providing its customers the most effective alternatives to ensure that shipments are delivered at the earliest possible time.”

INDONESIA

Passenger flights to and from Indonesia — including the popular tourist resort island of Bali — have been less affected than might be expected because there are no direct routes, with most stopping in Singapore or the Middle East, where any backlog would be felt.

Cargo flights to and from the capital, Jakarta, were however being hit.”Generally it will be a hindrance for anyone who has business relations in or with Europe,” said Hariyanto, branch head at Soekarno-Hatta airport, and who like many Indonesians, uses only one name.

SRI LANKA

In Sri Lanka, as many as 6,000 tourists were unable to return to their homes in Europe. S. Kalaiselvam, director-general of the Sri Lanka Tourism Development Authority, said tourism would be affected especially because the United Kingdom was the island’s top market. “It’s very difficult to say how much the loss is now. But now our concern is how to send the people who are already here back to their homes,”

BANGLADESH

State carrier Bangladesh Biman expects the flight disruption to cause losses, Muhammad Zakiul Islam, managing director and chief executive said. The disruption will also hit garment exports, the country’s top foreign exchange earner.

Reporting by Asia bureaux; Editing by Sanjeev Miglani

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