The Effects of Coronavirus on Transportation

The Centers for Disease Control said this week it is expecting that the COVID-19 virus will spread to the United States. With cases and fatalities rising, stock markets took a significant plunge and the world is watching closely. The virus is already having an effect on the global transportation system.

(Note: To limit the spread of COVID-19 and other illnesses, healthcare officials recommend straightforward prevention methods such as regular handwashing and avoiding close contact with anyone who is sick.)

Shared modes of transportation are most affected
Chinese officials took the unprecedented step of creating a quarantine around the city of Wuhan, shutting down its public transportation and restricting travel. Shortly thereafter, U.S. air carriers stopped most flights to and from China. From a transportation perspective, travel in the Wuhan region has all but stopped except for limited trips. What is happening in the rest of the country is more telling of the wider impacts on the transportation network.

In Shanghai and Beijing, which are not subject to quarantine, ridership on their metro systems are down 85 percent and 91 percent, respectively (Check out the full data table here.) Intercity rail trips have dropped more than 80 percent. Domestic airlines cut 13,000 daily flights within the country and some desperate ones are offering $4 fares. Justified or not, shared modes of transportation appear to be the most affected. But still only around 30 percent of people are going to work, affecting all transportation modes.

These trends are extending beyond China. Stocks of cruise ship lines, airlines, and other shared transportation services like Uber and Lyft have declined. On the other hand, the Wuhan quarantine has been a boon to Chinese home delivery services.

The coronavirus is revealing how interconnected global supply chains have become
Freight shipments globally are falling, and the lack of demand has driven down shipping rates as much as 70 percent. While some shipments are stopped in and out of the Wuhan region because of concern of spreading the virus, most decline in airborne and seagoing freight is due to closed businesses and factories. Freight shippers like UPS and FedEx have cut flights due to sagging demand.

Declines in freight shipments could have ripple effects across the world. For example, oyster farmers in Washington State are having trouble shipping their products to Asia because the ships normally loaded with Chinese goods are not arriving. Weaker shipments could affect an already-struggling shipping industry. With just-in-time supply chains crossing the Pacific, auto manufacturers are lacking vital parts for assembly, slowing production. Such disruptions will have short term effects on the ability to sell products, but in the long run could force companies to rethink supply chains exposed to epidemic risks.

Transportation agencies are more prepared than many expect
Meanwhile, transportation agencies, from public transit to airports, are dusting off their emergency preparedness manuals and making strategic investments to handle potential crises. The reaction to a coronavirus health scare at Honolulu airport “shows the state has the right procedures in place to monitor passengers who exhibit symptoms.” Transit agencies are investing millions of dollars for masks, signage, and disinfectant supplies to enable continue operations during a potential outbreak. Private companies are also implementing policies to ensure the safety of their employees and customers.

Given that at this time there is no coronavirus outbreak in the U.S., most transportation services in the U.S. can and should continue as normal. But businesses and transportation organizations need to start thinking about contingency plans to prepare for unknown outcomes and to help with government containment and mitigation strategies.



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