Volcanic ash cloud economics: Europe's winners and losers
As Iceland's volcanic ash cloud hangs over Europe, stranding airline passengers for a fifth day, the train, bus, taxi, and ferry companies are doing a booming business. Would you pay $5,000 for a taxi ride from Norway to Britain?
Getting stranded mid-journey because of volcanic ash is not cheap for many. But it is good business for some.Skip to next paragraph
As hundreds of thousands of travelers across the globe spent a fifth day Monday in hotel rooms, buying food, making phone calls, booking alternative travel routes and wondering how and when they were going to get moving – many were also wondering how they were going to pay for it all.
And they were not the only ones. The situation has had a devastating financial effect on many – from the obvious, such as grounded airlines to the less obvious, such as schools that have to bring in substitute teachers and flower farmers in Kenya who can't get their produce to their main European market.
Stories of the ingenious ways stranded passengers were finding ways home all come with big dollar signs.
Ken and Mandy Caskie from Surrey, England, promised their son Max they would get him home from Madrid to take his A level exams (critical for getting into a university) this week, they told the Daily Mirror. And so they did, organizing taxis, trains and even, at the very end, a private boat to bring him across the channel to Dover. The price tag: 8,000 pounds. ($12,254).
Ian Harris, a dentist from Sheffield, England, says he spent 2,000 pounds ($3,063) to get his family home by rental car, train, and bus from their vacation in Rome.
The biggest losers of course, were the airlines, which, according to the International Air Transport Association (IATA) were losing at least $200 million a day in revenue and are now demanding compensation from the European Union. "The estimate is conservative and does not include costs such as rerouting planes or caring for stranded passengers,” the IATA said in a statement.
It is being estimated that between disruptions to business, entertainment, and schools - the wider European economy was suffering additional losses of at least $150 million a day. Oil prices fell to around $81 a barrel in part because European flying restrictions have curbed jet fuel use.
Ferry traffic quadrupled
But, of course, not everyone was complaining. For some this was an opportunity – with those in the field of anything-but-airplanes transport doing particularly well.
The number of passengers using Brittany Ferries, P & O Ferries, and LD Ferries to get out of the United Kingdom surged in recent days. Brittany, the largest of the three companies, said 1,600 foot passengers had booked this weekend – more than four times the average.
Eurostar trains, in turn, were adding on as many trains as they could handle, and had served 50,000 more passengers than normal since the airline disruption began on Thursday, according to train officials.