The Impact of Lockdown Announcements for COVID-19 on the Stock Prices of Global Airlines

Proceedings of The 7th International Conference on Research in Management and Economics

Year: 2023



The Impact of Lockdown Announcements for COVID-19 on the Stock Prices of Global Airlines

Ziyue Cao





This study investigates the impact of COVID-19 related travel bans and lockdowns on the stock prices of airlines across five countries, examining the interplay of various factors such as the number of major airlines, lockdown duration, and types of airlines (economy vs. full-service and cargo-based vs. passenger-based). Using the GARCH model, the analysis reveals that the pandemic’s effects on airline stock prices are not uniform across countries and are significantly influenced by these factors. Countries with a higher number of major airlines and longer lockdown durations experienced a more pronounced negative impact on stock prices. Furthermore, full-service and passenger-based airlines suffered a greater decline in stock prices compared to economy and cargo-based airlines, which can be attributed to shifting consumer preferences and increased reliance on cargo transportation during the crisis. The findings highlight the need for tailored recovery strategies that take into account the unique circumstances of each country and airline and emphasize the importance of building resilience to withstand future crises. The study contributes to a deeper understanding of the differential effects of the pandemic on the airline industry, offering valuable insights for decision-makers and stakeholders in developing post-pandemic recovery strategies.

keywords: Financial Performance, GARCH Analysis, Global Stock Market, Pandemic Responses, Policy Implications