Business fallout: Companies in China see delays in reopening

Companies in China say they expect delays in resuming normal business to last through the second half of this year year as Beijing tries to revive its economy after declaring victory over the coronavirus

The spread of the coronavirus that emerged in China in December has dealt an unprecedented shock to the global economy. Here is a look at developments Wednesday:

CHINA BUSINESS: One in five companies surveyed by the American Chamber of Commerce in China expects delays in resuming normal business to last through the second half of this year.

About one-fifth of the 199 companies surveyed March 13-18 said they are back to normal after the Communist Party declared victory over the coronavirus and began easing travel and other controls. Three-fifths expect to resume normal operations by the end of April.

About 45% of companies in technology and services expect a “moderate to strong additional impact” in China due to the virus spreading worldwide.

Some 14% of companies said they are losing up to 500,000 yuan ($70,000) per day due to delay in reopening or restoring full operations.

OLYMPICS FALLOUT: The delay of the Olympics until 2021 could have major financial consequences for its U.S. broadcaster, NBCUniversal.

NBC paid $4.48 billion for the four Games between 2014 and 2020 and has sold $1.25 billion in ads for the Tokyo Olympics.

NBC’s parent, Comcast, said this month that it has language in its contracts and insurance that help protect it financially. But it will miss out on the ad sales-driven profits — those were $250 million for the 2016 Rio Olympics — and a chance to promote its upcoming streaming service, Peacock, as well as its other shows and movies.

Other entertainment companies have also warned the virus will hurt their financial results.

JOB CUTS: Canada’s second-biggest airline says almost half its employees are leaving amid the pandemic.

WestJet says 6,900 employees are leaving the company, 90 percent of them voluntarily. The company had 14,000 employees before the announcement.

Chief executive Ed Sims says departures include early retirements and both voluntary and involuntary layoffs.

The Calgary, Alberta-based carrier has cancelled all international flights for 30 days and, like its larger rival Air Canada, reduced domestic capacity.

HOTELS CONTRIBUTE: Hotel and home-sharing companies are offering free or discounted rooms to medical workers around the world.

Oyo Hotels, headquartered in India, said doctors, nurses and other medical personnel can stay at any of its 300 properties in the United States for free.

France’s AccorHotels has offered up to 2,000 beds to the French government to house the homeless. AccorHotels is also offering free stays for medical workers.

In Manchester, England, two hotels owned by former soccer stars are offering 176 free beds for medical workers.

Home-sharing company Airbnb says hosts in France will house medical workers for free. The company said 1,500 hosts offered homes within hours of the announcement. Airbnb made a similar offer in Italy last week, where 2,500 homes have been offered.

In some cases, hotels are also being used as medical facilities. Maryland Gov. Larry Hogan announced Monday that Baltimore’s convention center and adjacent Hilton hotel will be set up to take patients if hospitals run out of beds.

AIRLINE AID: French Finance Minister Bruno Le Maire said Tuesday the government is considering a bailout of Air France-KLM to offset plunging revenue due to the travel controls imposed to fight the coronavirus.

Source link