Hong Kong's Cathay Pacific Airways Ltd issued its first ever profit warning on Friday, sending its shares to a 16-month low as the deadly SARS virus and the Iraq war cut passenger traffic by one-third.
Singapore Airlines Ltd said it was cutting capacity again due to weak demand, bring its total cancellations in recent weeks to nearly 20 percent of its flights.
Australia's Qantas Airways Ltd and Germany's Deutsche Lufthansa AG have already warned their bottom lines will come under pressure as the war and virus wreak havoc on the industry, and analysts said other carriers such as Singapore Airlines may follow.
"Results for the first half of 2003 are expected to be materially affected by the recent sharp fall in passenger demand for air travel caused by the Iraq war and widespread public concerns over the outbreak of atypical pneumonia," Cathay said.
A Cathay spokeswoman confirmed that the company had not previously issued a profit warning.
"Others may well issue them," said Mark Webb, Singapore-based analyst at HSBC.
"Airlines that look to be very much at risk are Dragonair and Air Macau. Like Cathay, they are at the epicentre of the outbreak. There's no let-up," he said.
Dragonair is Hong Kong's second airline while Air Macau relieves heavily on traffic between Taiwan and mainland China, where the virus originated.