Manila and Cebu frequency retained
Hong Kong - Cathay Pacific has announced that it will reduce its passenger capacity by 8% and overall cargo capacity by 11% from May 2009 in response to “deteriorating” business conditions. At the same time, it will introduce a four-tier, top down special leave scheme where staff will be asked to take unpaid leave varying from one to four weeks according to their seniority.The airline said that it has already deferred delivery of two Boeing 777 aircraft to 2010 and is in talks with manufacturers on delaying other orders as the carrier seeks to conserve cash in the market downturn.
Cathay Pacific chief executive Tony Tyler says, “We anticipate an extremely challenging year in 2009 and a toxic combination of low fares, a big drop in premium travel, weak cargo loads, poor yields and a negative currency impact is making it more important than ever to preserve cash.”
He says the first quarter of 2009 saw a “marked deterioration” in Cathay Pacific’s business compared to the same period last year; turnover was down 22.4%. “We have no option but to take measures that will help us weather the current storm and maintain the long-term sustainability of the business.”
According to Tyler, there will be a reduction in flight frequencies or seat capacity to London, Paris, Frankfurt, Sydney, Singapore, Bangkok, Seoul, Taipei, Tokyo, Mumbai and Dubai. At the same time, additional flights will be routed to Denpasar, Sapporo, Bahrain and Riyadh. While flights to the Philippines and New Zealand will remain on status quo.
Dragonair, a subsidiary of Cathay Pacific, will also reduce its capacity by 13%. Flight services to Bengaluru, Busan, Sanya and Shanghai will be reduced, while services to Fukuoka, Dalian, Shenyang, Guilin and Xian will be suspended. The weekly freighter frequency will fall to 84 flights, down from 124 a week during 2008.
The company is also negotiating the sale of five aircraft and will park two more of its Boeing 747-400BCF freighters, taking the total to five, and wet-lease one BCF to subsidiary Air Hong Kong.
Under the special leave scheme, all of the 17,000 staff working for the airline in Hong Kong and overseas will be asked to take unpaid leave of one to four weeks, depending on seniority, over a 12-month period from May 1, 2009 to April 30, 2010.
Mr Tyler says the global economic meltdown is “hitting the aviation industry hard”, and that, unlike many of its competitors, Cathay Pacific gets no government financial support or subsidy. “Our staff are being asked to make sacrifices that will be needed to see the company through this violent storm. The pain will be shared from the top down.”
Tyler added that “We anticipate an extremely challenging year in 2009 and a toxic combination of low fares, a big drop in premium travel, weak cargo loads, poor yields and a negative currency impact is making it more important than ever to preserve cash…We have no option but to take measures that will help us weather the current storm and maintain the long-term sustainability of the business.”
The company is already offering low roundtrip business class fares to Asia to compete with low cost operators. Sample roundtrip fares including fees are $3,791, for JFK-Manila; $4,622, San Francisco-Hong Kong; and $5658, JFK to Hong Kong. The JFK to Manila fare however requires a seven-day advance purchase and that outbound travel must occur by June 30, 2009. The fare shown is valid for Monday through Thursday departures and available on Flights CX888/889 flights.
He says the first quarter of 2009 saw a “marked deterioration” in Cathay Pacific’s business compared to the same period last year; turnover was down 22.4%. “We have no option but to take measures that will help us weather the current storm and maintain the long-term sustainability of the business.”
According to Tyler, there will be a reduction in flight frequencies or seat capacity to London, Paris, Frankfurt, Sydney, Singapore, Bangkok, Seoul, Taipei, Tokyo, Mumbai and Dubai. At the same time, additional flights will be routed to Denpasar, Sapporo, Bahrain and Riyadh. While flights to the Philippines and New Zealand will remain on status quo.
Dragonair, a subsidiary of Cathay Pacific, will also reduce its capacity by 13%. Flight services to Bengaluru, Busan, Sanya and Shanghai will be reduced, while services to Fukuoka, Dalian, Shenyang, Guilin and Xian will be suspended. The weekly freighter frequency will fall to 84 flights, down from 124 a week during 2008.
The company is also negotiating the sale of five aircraft and will park two more of its Boeing 747-400BCF freighters, taking the total to five, and wet-lease one BCF to subsidiary Air Hong Kong.
Under the special leave scheme, all of the 17,000 staff working for the airline in Hong Kong and overseas will be asked to take unpaid leave of one to four weeks, depending on seniority, over a 12-month period from May 1, 2009 to April 30, 2010.
Mr Tyler says the global economic meltdown is “hitting the aviation industry hard”, and that, unlike many of its competitors, Cathay Pacific gets no government financial support or subsidy. “Our staff are being asked to make sacrifices that will be needed to see the company through this violent storm. The pain will be shared from the top down.”
Tyler added that “We anticipate an extremely challenging year in 2009 and a toxic combination of low fares, a big drop in premium travel, weak cargo loads, poor yields and a negative currency impact is making it more important than ever to preserve cash…We have no option but to take measures that will help us weather the current storm and maintain the long-term sustainability of the business.”
The company is already offering low roundtrip business class fares to Asia to compete with low cost operators. Sample roundtrip fares including fees are $3,791, for JFK-Manila; $4,622, San Francisco-Hong Kong; and $5658, JFK to Hong Kong. The JFK to Manila fare however requires a seven-day advance purchase and that outbound travel must occur by June 30, 2009. The fare shown is valid for Monday through Thursday departures and available on Flights CX888/889 flights.
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