April 29 (Bloomberg) -- Europe’s three largest airlines suspended penalties for passengers who want to change plans to avoid travel to Mexico during the swine flu outbreak.

Air France-KLM Group, Deutsche Lufthansa AG and British Airways Plc said today they’re allowing people ticketed to Mexico to postpone flights. Air France and British Airways are also permitting passengers to change destinations. Mexican and U.S. carriers including Aeromexico and American Airlines have taken similar steps.

U.S. officials recommend that nonessential travel to Mexico be avoided and the European Union has told travelers to avoid outbreak areas. French Health Minister Roselyne Bachelot said today she will ask the European Union to suspend flights to Mexico. Malaysia called on the World Health Organization to ban outbound travel from Mexico while Japan suspended visa-free entry for Mexican nationals.

“It’s not the fault of passengers that this is going on,” said Herve Erschler, a spokesman for Air France. “We’re trying to respond in a way that’s appropriate to the situation and makes commercial sense.”

The major European airlines haven’t altered flight schedules in response to the spreading illness. TUI AG and Thomas Cook Group Plc, Europe’s biggest tour operators, have temporarily canceled all U.K. flights to Cancun.

Flight Frequency

Air France offers twice-daily flights to Mexico City from Paris, one via code-sharing with SkyTeam partner Aeromexico. Lufthansa flies daily to Mexico City from Frankfurt, while British Airways flies four times a week from London to the Mexican capital.

The potential threat to airline travel comes after global traffic fell 11 percent in March, a steeper decline than February’s 10 percent. That extended a contraction that began in September, the Geneva-based International Air Transport Association said yesterday.

Spending on business travel was already set to decline about 7.5 percent during the next 12 months, according to Ascend, which studies air travel and maintains an online database of aircraft. In a survey of 280 frequent business travelers from more than 35 countries, Ascend found that 52 percent predict that their company’s air-travel budget will drop significantly.

‘Weak’ Business Travel

“This is the weakest outlook for international business travel in nearly 20 years,” Ascend Chief Economist Peter Morris said today in a statement. Swine flu adds to the industry’s difficulties, the data-provider said.

Air France is allowing passengers with tickets for travel to Mexico from now until May 31 to postpone flights or change destinations without penalties, providing all travel is competed by May 31, said Nicolas Petteau, a spokesman for the Paris-based company.

At British Airways, passengers can change their date of travel or destination, though the policy applies for a rolling period of seven days, said Philip Allport, a spokesman for the London-based carrier. That means only people ticketed before May 6 can postpone or change destination at this point.

Lufthansa isn’t offering changes in destination, though the carrier will let people rebook Mexican flights until May 6, said Thomas Jachnow, a spokesman for the Cologne, Germany-based airline. Lufthansa will review the situation daily to decide whether to extend the policy.

Iberia Lineas Aereas de Espana SA, which offers 12 trips a week between Madrid and Mexico City, is operating the flights as normal and allowing passengers to make changes without penalties, an official said.

To contact the reporter on this story: Andrea Rothman in Paris at aerothmanbloomberg.net

Last Updated: April 29, 2009 11:59 EDT