What’s going here?

• Disney, McDonald’s, Starbucks and other U.S. companies with significant exposure in China are suspending operations as response to the outbreak of the coronavirus.
• The municipal government of Shanghai also issued a notice ordering companies not to resume work after the CNY holiday until Feb. 3, instead of Jan. 31.
• The virus has now taken the lives of at least 82 people in China and sickened 2,900 worldwide, including in the U.S. and Europe.

What are the consequences?

• President Donald Trump has said the U.S. has offered help to China. U.S. health officials said they are monitoring 110 people across 26 states for the coronavirus.
• In an effort to control the spread of the virus, Chinese authorities have suspended public transportation in Wuhan, the epicenter of the outbreak, and in at least nine other cities.
• The virus is hitting businesses around the world.
  • The Shanghai stock exchange will remain closed until Feb. 3. All 3 major U.S. indices fell by more than 1% in intra-day trading Monday.
  • The travel sector is at substantial risk. 90% of the economic cost of the outbreak “is not related to the virus. It’s related to the panic,” and it can take between 10 months and 19 months for tourism and spending in an area to fully recover from a local outbreak.
• Each U.S. company is responding to the situation in its own way: suspending operations, restricting employee travel, canceling holiday celebrations and more. Here’s how some companies have responded so far:

Entertainment

• Disney closed its Shanghai Disney Resort on Jan. 25, and it will remain closed until further notice.
• Carnival Cruises suspended nine scheduled cruises between Jan. 25 and Feb. 4.
• MGM Resorts said it scaled back a Chinese New Year celebration at its Macao resort this past weekend.
• Royal Caribbean announced the suspension of two scheduled voyages, on Jan. 27 and Jan. 31, for its only ship home-ported in China.

Autos

• Fiat Chrysler has restricted travel to Wuhan as well as 10 other Chinese cities.
• GM has placed a temporary restriction on travel to Wuhan, where the company has a manufacturing base as part of a joint venture with China’s SAIC Motor.
• Ford Motor has suspended all business travel to Wuhan.

Retail

• Walmart said it is following official recommendations but did not say if it has closed any locations.
• McDonald’s announced it suspended operations in Wuhan and its surrounding cities where public transportation has been shuttered.
• Starbucks said it closed all shops and suspended delivery services in China’s Hubei province, where Wuhan is located.

Travel

• Delta Airlines will allow travelers with flights booked to, from or through Beijing or Shanghai until Jan. 31 to change their itineraries without paying a change fee.
• Airbnb is offering free cancellations on bookings for users who made a reservation in Wuhan from Jan. 21 until Jan 31. They will also offer cancellations if a user is being diagnosed or is suspected of having the coronavirus at the airport, port or train station.

Content source: Kim. S., Feuer. W. (2020) US companies suspend China operations, restrict travel as coronavirus outbreak spreads. CNBC. Available from: https://www.cnbc.com/2020/01/27/coronavirus-us-companies-suspend-operations-restrict-travel-as-outbreak-spreads.html [Accessed 28 January, 2020]