Category Archives: Cathay Pacific Airways

Cathay Pacific Group expects to resume 70% of pre-COVID passenger capacity levels by end of 2023

The Cathay Pacific Group – comprising passenger airlines Cathay Pacific and HK Express – is committed to restoring passenger capacity and connectivity in the Hong Kong aviation hub to serve the needs of the Hong Kong and international travel markets. It anticipates that the Group will be operating around 70% of its pre-pandemic passenger flight capacity by the end of 2023 with an aim to return to pre-pandemic levels by the end of 2024, ahead of the Asia-Pacific traffic forecast issued by the International Air Transport Association (IATA).

Following the Hong Kong Special Administrative Region (HKSAR) Government’s recent adjustments to anti-pandemic measures for travellers and aircrew entering Hong Kong, the Group has already announced the addition of about 3,000 passenger flight sectors from October until the end of December this year.

Chief Executive Officer Augustus Tang said: “The Group is on track to achieve its target of operating up to one-third of its pre-pandemic passenger flight capacity levels by the end of 2022. This represents a doubling of the capacity that we offered in August and is approximately eight times the average capacity the airline operated in the first half of 2022.

Top Copyright Photo: Cathay Pacific Airways Airbus A350-1041 B-LXE (msn 225) ZRH (Rolf Wallner). Image: 946828.

Cathay Pacific aircraft photo gallery:

Cathay Pacific to purchase 38 million US gallons of Sustainable Aviation Fuel from Aemetis

Cathay Pacific has announced the signing of an offtake agreement with Aemetis for the supply of 38 million US gallons of blended Sustainable Aviation Fuel (SAF) to be delivered over seven years beginning in 2025 from San Francisco International Airport. The SAF purchased can reduce more than 80,000 tonnes of lifecycle carbon emissions, equivalent to the amount of carbon sequestered by more than 1.3 million tree seedlings grown for 10 years. The agreement is also part of the joint procurement initiative for SAF by the oneworld alliance, of which Cathay Pacific is a founding member.

The blended SAF to be supplied under this agreement is 40% SAF and 60% Petroleum Jet A-1 fuel to meet international blending standards. The SAF will be produced at the Aemetis Carbon Zero plant currently under development in Riverbank, California. The facility will use waste wood to produce cellulosic hydrogen, and combine it with wastes and non-edible sustainable oils. It will then be converted into SAF using carbon-neutral hydroelectricity.  It is scheduled to begin deliveries to Cathay Pacific in 2025.

SAF provides significant environmental benefits compared to petroleum jet fuel, including up to 100% reduction in greenhouse gas emissions on a lifecycle basis, depending on the technology used.  It is a vital solution in the decarbonisation of aviation over the next few decades, especially for long-haul flights.

Cathay Pacific continues to pioneer the aviation industry’s transition towards the substantial use of SAF especially in supporting SAF development and deployment in Asia.

In other news, Cathay Pacific has also released its traffic figures for August 2022. The airline’s traffic figures continued to reflect the positive impact of further adjustments to the Hong Kong Special Administrative Region Government’s travel restrictions and quarantine requirements, notably the mandatory hotel quarantine arrangement for inbound travellers.

Cathay Pacific carried a total of 253,907 passengers last month, an increase of 87.6% compared to August 2021, but a 91.3% decrease compared to the pre-pandemic level in August 2019. The month’s revenue passenger kilometres (RPKs) increased 82.7% year-on-year, but were down 86.1% versus August 2019. Passenger load factor increased by 22.2 percentage points to 68.6%, while capacity, measured in available seat kilometres (ASKs), increased by 23.5% year-on-year, but decreased by 83.8% compared with August 2019 levels. In the first eight months of 2022, the number of passengers carried increased by 133.5% against a 1.6% increase in capacity and a 141.9% increase in RPKs, as compared to the same period for 2021.

The airline carried 104,851 tonnes of cargo last month, a decrease of 15.6% compared to August 2021, and a 35% decrease compared with the same period in 2019. The month’s cargo revenue tonne kilometres (RFTKs) decreased 23.3% year-on-year, and were down 35.1% compared to August 2019. The cargo load factor decreased by 10.7 percentage points to 67%, while capacity, measured in available cargo tonne kilometres (AFTKs), was down by 11.1% year-on-year, and was down by 41.1% versus August 2019. In the first eight months of 2022, the tonnage decreased by 8% against a 25.4% drop in capacity and a 32.4% decrease in RFTKs, as compared to the same period for 2021.

Travel

Chief Customer and Commercial Officer Ronald Lam said: “We continued to see improved performance in our travel business in August. Average daily passenger numbers further increased month on month and exceeded 8,000. Passenger flight capacity increased 28% compared with July, although we still only operated about 16% of pre-pandemic levels. Meanwhile, load factor remained high at close to 69%.

“Following the Hong Kong SAR Government’s adjustment to the hotel quarantine arrangement for travellers entering Hong Kong from 12 August, we observed an increase in inbound traffic to our home hub. This was particularly so for long-haul traffic from the US, Canada and Europe. Meanwhile, our passenger flight capacity to the Chinese Mainland remained restricted, although we were able to resume carrying passengers to Zhengzhou, Qingdao and Xiamen in August.

“Student traffic from the Chinese Mainland to the US represented a significant portion of our passenger traffic last month. On top of our existing services to New York, Los Angeles and San Francisco, we resumed flights to Chicago and Boston in August for the first time this year to cater to the strong demand. As a result, our US-bound flights managed 80% load factors. Apart from student traffic, our US routes were also boosted in the other direction by transit traffic travelling to Southeast Asia, the result of greater connectivity from increased flight frequency.

Cargo

“In terms of cargo, we operated a full freighter schedule in August, which was supported by increased passenger flights as well as regional cargo-only passenger flights. While our overall cargo flight capacity was down 11% compared with the same period last year, this was because we operated a significant number of long-haul cargo-only passenger flights at that time. Overall, we operated 59% of our pre-pandemic cargo flight capacity in August. Demand has remained flat throughout the summer months, but we have continued to make all preparations to ensure smooth operations as we step into the cargo peak season.

“Supporting the Cathay Pacific Group’s net-zero carbon emissions by 2050 target, we have extended our carbon-offset programme, Fly Greener, to our air cargo services. The programme not only enables our cargo customers to calculate the carbon emissions for their shipments, but also allows them to purchase carbon offsets to support carbon-offset projects. All selected projects are certified by the internationally recognised non-profit organisation, Gold Standard, to ensure their carbon reductions and societal benefits are verified to have met their standards.

“Furthermore, in an ongoing effort to improve the quality of our service delivery, we have introduced two new Cargo iQ milestone measurements – freight out of warehouse (FOW) and freight into warehouse (FIW). These additional milestones will bring greater transparency to the overall shipment journey, and are now operational at the Cathay Pacific Cargo Terminal in Hong Kong, with plans in place to roll them out across our network in the near future.

Outlook

”Looking ahead, we welcome the Hong Kong SAR Government’s adjustments to the mandatory quarantine arrangements for locally based aircrew arriving in Hong Kong earlier this month. While we will continue to add back more flights as quickly as is feasible to strengthen the network connectivity of the Hong Kong aviation hub, this will still take time as we build operational readiness and undertake a substantial amount of training and aircraft reactivation.

“This, combined with other operational complexities, means that capacity can only be increased gradually over a period of several months. As such, we are now projecting by the end of the year to be able to operate about one-third of our pre-pandemic passenger flight capacity – about double the passenger flight capacity we operated in August – and about two-thirds of our pre-pandemic cargo flight capacity. As the market and operating conditions further improve moving forward, we will aim to add back more flights where feasible.

“On the travel side, we expect that demand will remain solid going into the fourth quarter. Transit traffic between the Americas and Southeast Asia and India is anticipated to be strong, while traffic between Australia, New Zealand and other parts of our network is also expected to increase.

“As more regional destinations such as Japan continue to adjust their inbound travel policies, we will continue to monitor demand and adjust our passenger flight capacity accordingly. We intend to add about 200 pairs of passenger flights in October, primarily to regional destinations such as Osaka, Seoul (Incheon), Bangkok, Kuala Lumpur and Manila, and also to long-haul destinations such as Vancouver, Sydney and Melbourne.

“Regarding cargo, whilst the anti-pandemic measures in the Chinese Mainland may affect supply chains, it has been encouraging to see New Product Introduction (NPI) shipments begin in September, which bodes well for the expected solid peak season. As a result, we will continue to maximise freighter capacity, supported by increased passenger services and regional cargo-only passenger flights.”

The full August figures and glossary are on the following pages.

CATHAY PACIFIC TRAFFIC

AUG 2022

%Change VS AUG 2021

Cumulative AUG 2022

%Change YTD

RPK (000)        
 – Chinese Mainland 72,967 0.9% 255,076 66.3%
 – North East Asia 23,618 121.4% 71,813 56.9%
 – South East Asia 77,827 342.3% 271,709 111.3%
– South Asia, Middle East  & Africa 31,583 313.5% 90,046 447.5%
 – South West Pacific 135,153 631.4% 554,102 422.9%
 – North America 825,314 35.4% 2,041,843 81.7%
 – Europe 436,049 210.1% 1,463,269 276.8%
RPK Total (000) 1,602,511 82.7% 4,747,858 141.9%
Passengers carried 253,907 87.6% 809,115 133.5%
Cargo revenue tonne km (000) 600,283 -23.3% 3,269,911 -32.4%
Cargo carried (000kg) 104,851 -15.6% 731,442 -8.0%
Number of flights 1,795 -2.7% 11,127 13.5%

 

CATHAY PACIFIC CAPACITY

AUG 2022

%Change VS AUG 2021

Cumulative AUG 2022

%Change YTD

ASK (000)        
 – Chinese Mainland 126,196 -1.3% 717,259 59.1%
 – North East Asia 66,689 14.1% 245,423 -29.3%
 – South East Asia 151,095 54.9% 516,528 -17.9%
– South Asia, Middle East  & Africa 65,139 131.4% 198,616 160.1%
 – South West Pacific 205,987 -34.3% 935,151 -38.9%
 – North America 1,231,895 29.4% 2,843,014 -6.3%
 – Europe 489,843 56.0% 1,762,317 70.0%
ASK Total (000) 2,336,844 23.5% 7,218,308 1.6%
Passenger load factor 68.6% 22.2%pt 65.8% 38.1%pt
Available cargo tonne km (000) 895,827 -11.1% 4,467,284 -25.4%
Cargo load factor 67.0% -10.7%pt 73.2% -7.6%pt
ATK (000) 1,120,209 -5.7% 5,159,158 -22.6%

 

Cathay Pacific aircraft photo gallery:

Cathay Pacific Airways cuts its losses in the first 6 months of 2022

Cathay Pacific Airways released this interim financial report:

Financial and Operational Highlights Group Financial Statistics

Chairman’s Statement

The Cathay Pacific Group had an extremely difficult start to 2022. For more than two years, COVID-19 has had an unprecedented impact on global aviation with the situation often fluctuating between periods of relative improvement and significant setbacks as new variants of the virus have emerged. The first half of 2022 bore similarities to the first half of 2021. The spread of a new COVID-19 variant, Omicron, led to increasingly stringent travel and operational restrictions, most notably in Hong Kong and the Chinese Mainland, which severely constrained our ability to operate flights and greatly affected the demand for travel.

Early in January, Hong Kong saw the introduction of a number of measures intended to combat the virus, including a ban on flights to Hong Kong from nine countries, among them key markets such as the UK and the US, and a ban on transit and transfer services via Hong Kong International Airport. Quarantine rules for Hong Kong-based aircrew as well as the route-specific flight-suspension mechanism were also further tightened.

These restrictions resulted in a particularly unfavourable first few months of 2022 and we significantly reduced our passenger and cargo flight capacities. As our home city endured an especially difficult phase of the pandemic, we supported the safe movement of people and essential goods between Hong Kong and the rest of the world and preserved the fundamental integrity of our passenger and cargo networks.

The challenges posed by COVID-19, and the restrictions in place to combat it, placed a considerable burden on many of our employees, most notably our aircrew, thousands of whom spent countless nights in quarantine hotels. I wish to extend our sincere appreciation to all our people for the selfless endeavour and extraordinary professionalism they displayed throughout this very difficult time.

The progressive adjustments to these restrictions from 1st May were positive developments. Adjustments to the testing and quarantine requirements for Hong Kong-based aircrew enabled us to progressively resume flights to more destinations in May and June. This included the resumption of daily London passenger flights, and a full freighter schedule.

The loss attributable to the Cathay Pacific Group, which includes Cathay Pacific, its subsidiaries and its associates, was HK$4,999 million in the first half of 2022 (2021 first half: loss of HK$7,565 million). Cathay Pacific’s loss after tax was HK$1,501 million in the first half of 2022 (2021 first half: loss of HK$5,031 million). The share of losses from subsidiaries was HK$1,015 million (2021 first half: loss of HK$1,224 million), and the share of losses from associates was HK$2,483 million (2021 first half: loss of HK$1,310 million).

Business performance of Cathay Pacific

Ongoing COVID-19-related travel restrictions and quarantine requirements severely constrained our passenger operations. Passenger flight capacity decreased by 26.6%. Notwithstanding this, passenger revenue increased by 177.6% to HK$2,068 million in the first half of 2022 compared with the first half of 2021. Revenue passenger kilometres (RPK) increased by 129.7%. We carried 335 thousand passengers in the first half of the year, an average of 1,853 passengers per day, which was 113.4% more than in the same period last year. The load factor was 59.2%, compared with 18.9% in the first half of 2021.

Our cargo performance was similarly affected by restrictions and quarantine requirements for Hong Kong-based aircrew. Available cargo tonne kilometres (AFTK) decreased by 31.0%. Total tonnage decreased by 4.2% to 526 thousand tonnes. Cargo revenue was HK$12,148 million, an increase of 9.3% compared to the first half of 2021. Load factor was high at 75.8% (2021 first half: 81.4%), and yield increased 69.7% to HK$5.72.

As has remained the case throughout the pandemic, we are focused on prudent cost management. Non-fuel costs decreased by 4.9% to HK$16,056 million compared with the first half of 2021. Total fuel costs for Cathay Pacific (before the effect of fuel hedging) in the first half of 2022 increased by HK$1,458 million (or 54.8%) compared with the first half of 2021.

Business performance of subsidiaries and associates

HK Express reported a loss of HK$824 million for the first half of 2022 (2021 first half: loss of HK$976 million). The quarantine requirements for Hong Kong-based aircrew and stringent travel restrictions adversely affected the airline’s results.

Air Hong Kong reported a profit of HK$383 million for the first half of 2022 (2021 first half: HK$374 million). Quarantine requirements for locally based aircrew affected its ability to mount further cargo flight capacity.

Our airline services subsidiaries’ financial performance was generally better than in the first half of 2021, but nevertheless continued to reflect the substantial reduction in passenger numbers and cargo volumes.

Air China (accounted for three months in arrears) was adversely affected by COVID-19. Its results were worse than those included in the first half of 2021.

Financial position

Our monthly operating cash performance was negatively impacted by the difficult start to the year. However, the Hong Kong SAR Government’s adjustments in travel restrictions and quarantine requirements, which came into effect on 1st May, resulted in a better-than-expected monthly cash performance, such that we were operating cash generative towards the end of the first half of the year. As the pandemic situation remains uncertain, we continue to maintain our focus on prudent cash management and are targeting to be operating cash generative going forward.

As of 30th June 2022, our available unrestricted liquidity stood at HK$26.7 billion. We are grateful to the Hong Kong SAR Government for agreeing to extend the drawdown period of the HK$7.8 billion bridge loan facility for a further 12 months to 8th June 2023. This gives us greater flexibility to manage our liquidity position.

Prospects

Looking ahead, the most recent adjustments to quarantine arrangements for arriving passengers are expected to improve travel sentiment. We are targeting to progressively increase passenger flight capacity up to a quarter and cargo flight capacity to 65% of the pre-pandemic level by the end of 2022. This gives us confidence that our airlines and subsidiaries will see a stronger second-half than first-half performance. However, the results from associates (the majority of which are reported three months in arrears) will remain very challenging.

As the home carrier of Hong Kong, we are entirely focused on resuming connectivity between Hong Kong and the world. While we are fully committed to supporting our home city, our ability to operate more flight capacity continues to be severely constrained by a bottleneck on crewing resources under the existing quarantine requirements. We will only be able to operate more flight capacity when the existing stringent travel restrictions and quarantine requirements applicable to Hong Kong-based aircrew are lifted.

The National 14th Five-Year Plan sets out the role that Hong Kong will play in the overall development of the country and reinforces the importance of strengthening Hong Kong as a leading international aviation hub. The recent commencement of flight operations on the Third Runway at Hong Kong International Airport gives us confidence, and we are determined to play our part in the revival of a thriving Hong Kong aviation hub, critical to Hong Kong’s continued economic success.

On the expectation that borders will reopen, our teams have been actively preparing to meet the rising global demand for travel. In this context, we are bringing aircraft parked overseas back to Hong Kong and have already commenced a comprehensive recruitment plan with the aim of hiring more than 4,000 front-line employees to meet the airline’s operational needs over the next 18-24 months.

Finally, I would like to thank all our employees for their dedication and professionalism as they work tirelessly to keep the airline operating under incredibly challenging conditions. They remain the backbone of our organisation, and the heart of the industry-leading service that Cathay Pacific is known for.

Patrick Healy

Chairman
Hong Kong, 10th August 2022

Cathay Pacific aircraft photo gallery:

Cathay Pacific to return to Dubai, releases its traffic figures for June, opens the third runway at HKG

Cathay Pacific Airways will return to Dubai on October 2, 2022 with three weekly flights.

The company also issued its traffic numbers for June:

Cathay Pacific released its traffic figures for June 2022. The airline’s traffic figures continued to reflect the positive impact of further adjustments to the Hong Kong Special Administrative Region Government’s travel restrictions and quarantine requirements, notably the circuit-breaker mechanism, effective from 1 June.

Cathay Pacific carried a total of 150,077 passengers last month, an increase of 269.2% compared to June 2021, but a 95.2% decrease compared to the pre-pandemic level in June 2019. The month’s revenue passenger kilometres (RPKs) increased 320.2% year-on-year, but were down 91.7% versus June 2019. Passenger load factor increased by 45.3 percentage points to 67%, while capacity, measured in available seat kilometres (ASKs), increased by 36.2% year-on-year, but decreased by 89.3% compared with June 2019 levels. In the first six months of 2022, the number of passengers carried increased by 113.5% against a 26.6% decrease in capacity and a 129.8% increase in RPKs, as compared to the same period for 2021.

The airline carried 104,559 tonnes of cargo last month, a decrease of 4.4% compared to June 2021, and a 36.2% decrease compared with the same period in 2019. The month’s cargo revenue tonne kilometres (RFTKs) decreased 14.6% year-on-year, and were down 39.1% compared to June 2019. The cargo load factor decreased by 12.1 percentage points to 68.4%, while capacity, measured in available cargo tonne kilometres (AFTKs), was up by 0.5% year-on-year, but was down by 44.1% versus June 2019. In the first six months of 2022, the tonnage decreased by 4.3% against a 31% drop in capacity and a 35.7% decrease in RFTKs, as compared to the same period for 2021.

Travel

Chief Customer and Commercial Officer Ronald Lam said: “We continued to see positive developments in June following further adjustments to travel restrictions in Hong Kong. As sentiment for travel continued to improve, we resumed more flights to more destinations and deployed additional passenger flight capacity – about 170% more than we did in May – to meet the demand. However, we still only operated about 11% of our pre-pandemic capacity. Load factor increased to 67% and we carried on average more than 5,000 passengers per day.

“The additional flights that we operated helped provide greater connectivity for our transit passengers, notably from the Chinese Mainland. We also saw increased demand for flights between the UK and Australia, as well as between the US and the Philippines. As is typical for June, demand for student travel into Hong Kong was strong and our flights from the UK averaged high load factors of 93%. We also resumed flights to Auckland in June, which saw good demand not only to and from Hong Kong, but also between New Zealand and the UK as well as India. On the other hand, our flights to the Chinese Mainland remained limited by capacity restrictions relating to anti-pandemic measures there.

Cargo

“For cargo, we resumed our full freighter schedule in June with increased flights to the Americas and Europe. This was complemented by the belly capacity provided by our increased passenger flights as well as more than 600 pairs of regional cargo-only passenger flights. In total, we operated about 56% of our pre-pandemic cargo flight capacity last month.

“Tonnage picked up month on month in our home market, Hong Kong, underpinned by more stable cross-border feeder services. Tonnage from the Chinese Mainland also improved as pandemic restrictions eased. Cargo traffic from the Americas and Europe has also been encouraging, with increased frequencies on our long-haul services bringing more cargo to Asia. Overall, tonnage increased by more than 13% month on month, but was below the levels of June last year. This was largely due to reduced consumer demand from North American and European markets, and supply chain disruptions taking time to recover.

Outlook

”Looking ahead, we welcome the Hong Kong SAR Government’s recent decision to suspend the circuit-breaker mechanism effective 7 July, which will help provide customers with far greater certainty and confidence when flying to and transiting via Hong Kong. We are also encouraged that the Government is considering possible adjustments to the number of days inbound travellers will need to spend in designated quarantine hotels after arriving in Hong Kong. We continue to actively add back flight capacity as we work to rebuild our hub and network.

“On the passenger side, we expect travel sentiment will continue to improve over the coming months. Assuming current travel and operating restrictions as at the time of this report remain unchanged, we anticipate we will be able to operate up to about a quarter of our pre-pandemic passenger flight capacity levels by the end of the year. Having said that, the pandemic situation remains highly dynamic and we will need to remain agile with regards to managing our flight capacity.

“In terms of cargo, we are anticipating that demand will pick up as we step out from the traditionally slower summer months and into the usual peak cargo season. Notwithstanding the various operational challenges that will be involved in preparing for this increased demand, we target to be operating about 65% of our pre-pandemic cargo flight capacity by the end of this year.

“We have enjoyed improved cash performance since the further adjustments in the travel restrictions and quarantine requirements came into effect on 1 May. We expect that the anticipated capacity increases will continue to have a positive impact on our monthly operating cash burn, such that we are targeting to be operating cash generative going forward. As the pandemic situation remains uncertain, we continue to maintain our focus on prudent cash management.”

The full June figures and glossary are on the following pages.

CATHAY PACIFIC

TRAFFIC

JUN

2022

% Change

vs JUN 2021

Cumulative

JUN 2022

% Change

vs YTD

RPK (000)        
 – Chinese Mainland 33,063 107.0% 137,503 128.2%
 – North East Asia 11,960 136.9% 27,171 3.6%
 – South East Asia 46,250 196.4% 102,138 11.2%
 – South Asia, Middle East  & Africa 20,676 731.4% 26,222 759.6%
 – South West Pacific 131,388 685.9% 244,425 259.8%
 – North America 387,083 244.6% 679,368 89.3%
 – Europe 352,700 436.2% 592,819 230.4%
RPK Total (000) 983,120 320.2% 1,809,646 129.8%
Passengers carried 150,077 269.2% 335,462 113.5%
Cargo revenue tonne km (000) 564,955 -14.6% 2,122,833 -35.7%
Cargo carried (000kg) 104,559 -4.4% 525,877 -4.3%
Number of flights 1,638 21.2% 7,610 19.6%

 

CATHAY PACIFIC

CAPACITY

JUN

2022

% Change

vs JUN 2021

Cumulative

JUN 2022

% Change

vs YTD

ASK (000)
 – Chinese Mainland 85,520 52.8% 490,487 94.9%
 – North East Asia 32,878 -30.7% 103,377 -56.2%
 – South East Asia 79,405 2.1% 206,570 -54.0%
– South Asia, Middle East  & Africa 47,051 236.2% 67,585 234.3%
 – South West Pacific 297,982 12.7% 480,535 -48.6%
 – North America 490,540 8.8% 936,405 -45.3%
 – Europe 433,650 160.6% 773,849 37.4%
ASK Total (000) 1,467,026 36.2% 3,058,808 -26.6%
Passenger load factor 67.0% 45.3%pt 59.2% 40.3%pt
Available cargo tonne km (000) 825,470 0.5% 2,801,215 -31.0%
Cargo load factor 68.4% -12.1%pt 75.8% -5.6%pt
ATK (000) 965,945 4.5% 3,094,076 -30.5%

 

In other news, Cathay Pacific opened the third runway at its Hong Kong hub:

Cathay Pacific on July 8, 2022 operated the very first commercial flight to land at the new Third Runway of the Hong Kong International Airport (HKIA). The landing of flight CX3251 from Shanghai (Pudong), operated by our Boeing 747-400F freighter, at 08:27 local time on 8 July 2022 was conducted as part of the operation familiarisation on the Third Runway. This allows stakeholders from the aviation community to become familiar with the related operating procedures and collaborative arrangements.

Cathay Pacific aircraft photo gallery:

 

Cathay Pacific’s traffic improves in May, but still down 98% since May 2019

Cathay Pacific today released its traffic figures for May 2022. As the recent adjustments to the Hong Kong Special Administrative Region Government’s travel restrictions and quarantine requirements became effective in phases, the airline’s May 2022 traffic figures started to reflect the positive impact of those changes.

Cathay Pacific carried a total of 57,982 passengers last month, an increase of 141.5% compared to May 2021, but a 98% decrease compared to the pre-pandemic level in May 2019. The month’s revenue passenger kilometres (RPKs) increased 164.4% year-on-year, but were down 97.1% versus May 2019. Passenger load factor increased by 33.7 percentage points to 60.5%, while capacity, measured in available seat kilometres (ASKs), increased by 16.8% year-on-year, but decreased by 96% compared with May 2019 levels. In the first five months of 2022, the number of passengers carried increased by 59.1% against a 48.5% decrease in capacity and a 49.3% increase in RPKs, as compared to the same period for 2021.

The airline carried 92,426 tons of cargo last month, a similar level as May 2021, but a 45.1% decrease compared with the same period in 2019. The month’s cargo revenue tonne kilometres (RFTKs) decreased 32.5% year-on-year, and were down 59.9% compared to May 2019. The cargo load factor decreased by 5.3 percentage points to 75.7%, while capacity, measured in available cargo tonne kilometres (AFTKs), was down by 27.7% year-on-year, and was down by 66.1% versus May 2019. In the first five months of 2022, the tonnage decreased by 4.3% against a 38.9% decrease in capacity and a 41% decrease in RFTKs, as compared to the same period for 2021.

Travel

Chief Customer and Commercial Officer Ronald Lam said: “The introduction of further adjustments to travel restrictions and quarantine requirements in Hong Kong from 1 May was a welcome development, although our business during the month remained constrained. We increased our passenger flight capacity by 78% compared with April, but we still only operated about 4% of our pre-pandemic levels. Traffic volume in terms of RPK increased 94% month on month, and this was driven primarily by long-haul flights. As a result, overall load factor reached 60.5%.

“The additional passenger flight capacity we mounted in May provided better connectivity for our transit passengers, particularly those travelling from the Chinese Mainland to long-haul destinations such as the US, Europe and Australia. Demand for inbound flights to Hong Kong saw substantial growth, driven by pent-up demand out of North America, the UK and Europe. We also resumed flights to India last month with services to Delhi and Mumbai. On the other hand, we continued to operate limited frequencies into the Chinese Mainland to comply with ongoing capacity restrictions.

Cargo

“Regarding cargo, the situation in Shanghai continued to affect demand, although tonnage gradually picked up as COVID-19 restrictions started to ease towards the end of May. As for Hong Kong, volumes improved as cross-border feeder services between Shenzhen and Hong Kong allowed for a more stable flow of cargo, although it remains below the capacity available prior to the fifth wave of COVID-19 in Hong Kong. Demand from other parts of our network remained relatively strong throughout the month. Overall in May, we operated about 34% of our pre-pandemic cargo flight capacity, while load factor was 75.7%.

“Last month also saw the expansion of our joint business agreement with Lufthansa Cargo to include Swiss WorldCargo. Cathay Pacific Cargo will expand its collaboration on trade lanes between Hong Kong and Europe to provide even greater choice and value for our cargo customers.

“Additionally, our Cargo and Lifestyle businesses have jointly developed a door-to-door solution that enables customers in Hong Kong to enjoy fresh fruit and vegetables sourced from premium producers in Northeast Asia and delivered directly to their homes. This fresh produce is available through the Cathay shop.

Outlook

“The first quarter of 2022 saw a tightening of travel restrictions and quarantine requirements as Hong Kong continued to fight against COVID-19. Such measures have restricted our ability to operate beyond only a fraction of our passenger services and have significantly reduced our cargo capacity. However, with the recent adjustments to travel restrictions and quarantine requirements, we have been able to resume more flight capacity in the second quarter. Given a strong underlying cargo performance coupled with our cost-management measures implemented over the past two years, our consolidated losses in the first half of 2022, while substantial, are expected to be lower than the consolidated losses reported in the first half of 2021.

“Earlier this month, the Hong Kong SAR Government agreed to extend the drawdown period of the HK$7.8 billion loan facility for 12 months to 8 June 2023. The further extension of the drawdown period is greatly appreciated and will provide us with flexibility to manage our liquidity position.

“Looking ahead to June and beyond, as travel demand continues to improve over the coming months, we will increase passenger flight capacity as much as is practicable under the confines of ongoing restrictions. Cathay Pacific started the year operating flights to 29 destinations and we target to double that by the end of the year. As of June, we are already halfway towards reaching this target with 45 destinations resumed. We will be keeping a close eye on the opening up of travel activities in nearby countries, such as Japan and South Korea, and will look to operate flights to capture potential demand wherever possible. We also expect transit traffic to improve and become more diversified, in particular between the UK, Australia and New Zealand, as well as North America and Southeast Asia.

“On the cargo side, we have been able to progressively add long-haul freighter services on both Transpacific and European routes with a full freighter schedule operating from June onwards. This will be further supplemented by increased passenger flight frequencies and cargo-only passenger services to provide additional lift. With disrupted supply chains in Shanghai and elsewhere in the world, the short-term outlook for our air cargo business remains positive, whilst we currently remain confident for a solid traditional peak season later this year.”

The full May figures and glossary are on the following pages.

CATHAY PACIFIC TRAFFIC

MAY

2022

% change

vs MAY21

Cumulative

MAY 2022

% change

vs YTD21

RPK (000)        
 – Chinese mainland 23,788 135.3% 104,440 135.9%
 – North East Asia 3,764 -1.5% 15,211 -28.2%
 – South East Asia 15,680 22.1% 55,888 -26.7%
– South Asia, Middle East  & Africa 5,327 844.7% 5,546 883.6%
 – South West Pacific 35,753 293.0% 113,037 120.7%
 – North America 137,509 182.2% 292,284 18.6%
 – Europe 107,771 172.9% 240,119 111.3%
RPK Total (000) 329,592 164.4% 826,525 49.3%
Passengers carried 57,982 141.5% 185,385 59.1%
RFTK Total (000) 377,237 -32.5% 1,557,877 -41.0%
Cargo and mail carried (000Kg) 92,426 0.0% 421,345 -4.3%
Number of flights 1,192 19.6% 5,972 19.1%

 

CATHAY PACIFIC CAPACITY

MAY

2022

% change

vs MAY21

Cumulative

MAY 2022

% change

vs YTD21

ASK (000)        
 – Chinese mainland 71,679 78.0% 404,967 107.0%
 – North East Asia 17,312 -52.5% 70,499 -62.6%
 – South East Asia 29,863 -48.6% 127,165 -65.8%
– South Asia, Middle East  & Africa 17,708 184.7% 20,534 230.1%
 – South West Pacific 55,663 -42.7% 182,554 -72.8%
 – North America 199,341 43.8% 445,865 -64.6%
 – Europe 153,631 71.1% 340,199 -14.3%
ASK Total (000) 545,197 16.8% 1,591,783 -48.5%
Passenger load factor 60.5% 33.7%pt 51.9% 34.0%pt
AFTK Total (000) 498,218 -27.7% 1,975,745 -38.9%
Cargo and mail load factor 75.7% -5.3%pt 78.9% -2.7%pt
ATK (000) 550,499 -25.0% 2,128,131 -39.7%

 

 

 

 

Cathay Pacific to operate the longest flight to avoid Russian airspace

Cathay Pacific Airways is planning to reroute its long-distance Hong Kong – New York (JFK) route to avoid Russian airspace.

The planning to operate the 10,326 mile route south of Russia, via Europe and the North Atlantic in 17 hours.

More from Bloomberg:

 

Cathay Pacific reports an increase of 47.9% compared to February 2021, but a 98.9% decrease compared to the pre-pandemic level in February 2019

Cathay Pacific Airways released its traffic figures for February 2022 that continued to reflect the airline’s substantial capacity reductions in response to significantly reduced demand as well as travel restrictions and quarantine requirements in place in Hong Kong and other markets amid the ongoing global COVID-19 pandemic.

Cathay Pacific carried a total of 31,253 passengers last month, an increase of 47.9% compared to February 2021, and a 98.9% decrease compared to the pre-pandemic level in February 2019. The month’s revenue passenger kilometres (RPKs) increased 5.2% year-on-year, and were down 99% versus February 2019. Passenger load factor increased by 33.8 percentage points to 47.6%, while capacity, measured in available seat kilometres (ASKs), decreased by 69.4% year-on-year, and decreased by 98.4% compared with February 2019 levels. In the first two months of 2022, the number of passengers carried increased by 8.6% against a 72.8% decrease in capacity and a 12.5% decrease in RPKs, as compared to the same period for 2021.

The airline carried 65,126 tonnes of cargo last month, a decrease of 20.9% compared to February 2021, and a 50.4% decrease compared with the same period in 2019. The month’s cargo revenue tonne kilometres (RFTKs) decreased 53.3% year-on-year, and were down 67.9% compared to February 2019. The cargo load factor increased by 0.9 percentage points to 80.5%, while capacity, measured in available cargo tonne kilometres (AFTKs), was down by 53.8% year-on-year, and was down by 75.8% versus February 2019. In the first two months of 2022, the tonnage decreased by 27.1% against a 59.1% drop in capacity and a 59.6% decrease in RFTKs, as compared to the same period for 2021.

Travel

Chief Customer and Commercial Officer Ronald Lam said: “The operating environment for Cathay Pacific remains very challenging. Travel and operational restrictions in place in Hong Kong continued to constrain our ability to operate more passenger flight capacity in February and we operated below 2% of pre-COVID-19 levels, a reduction of about 28% compared with January 2022.

“We have remained as agile as possible, deploying passenger flight capacity to cater to last-minute demand, on top of ongoing traffic from the Chinese Mainland to long-haul destinations as well as post-Chinese New Year traffic from Hong Kong to the Chinese Mainland. We also saw some demand for flights to Australia, notably student traffic from the Chinese Mainland and Hong Kong. As a result, we carried more passengers in February than we did in January. Load factor edged up to reach about 48%.

Cargo

“We continue to operate a reduced long-haul cargo schedule in light of ongoing crew quarantine measures and in February we operated around 25% of our pre-COVID-19 cargo flight capacity. Tightened requirements for cross-border trucking between the Chinese Mainland and Hong Kong, as well as the surge in COVID-19 cases in Hong Kong, reduced demand from our home market. Furthermore, the anticipated market recovery from Asia to long-haul destinations was slower than expected post-Chinese New Year.

“In order to mitigate these headwinds, our teams focused on regional routes and we saw encouraging demand on these services. Of particular note was the demand for Rapid Antigen Test (RAT) shipments, which was strong throughout the month and continues to be so. As of the end of February, we have delivered over 13 million RAT kits to Hong Kong. We will continue to support the Government’s anti-pandemic efforts with the delivery of important medical supplies.

Outlook

”Looking ahead in March, on the travel side we originally expected that the majority of passenger traffic would continue to come from our Chinese Mainland routes. However, stricter capacity restrictions have since been put in place by the Chinese Mainland authorities as part of their pandemic control measures. These, together with the current restrictions in Hong Kong, mean that we do not foresee significant signs of recovery in passenger travel demand in March.

“Regarding cargo, we are re-deploying freighters to North Asia and the Indian sub-continent to maximise opportunities within the region while our ability to operate long-haul services remains constrained. Nevertheless, we are continually looking to increase our long-haul cargo flight capacity where possible, and we have resumed freighter services into Atlanta, Houston and Miami in the US. Our total Hong Kong export volumes will likely remain under pressure throughout the month. Despite this, overall demand from other markets is strengthening and we will look to capture as much of this opportunity as possible.”

The full February figures and glossary are on the following pages.

CATHAY PACIFIC TRAFFIC

FEB % Change Cumulative %

Change

  2022 VS FEB 2021

 

FEB 2022 YTD

 

RPK (000)        
 – Chinese Mainland 25,302 295.5% 39,330 161.1%
 – North East Asia 1,761 -50.7% 3,554 -66.4%
 – South East Asia 7,676 -51.8% 14,949 -57.5%
– South Asia, Middle East  & Africa 219
 – South West Pacific 21,277 96.8% 34,315 6.0%
 – North America 21,041 -54.8% 70,815 -44.4%
 – Europe 21,970 101.3% 52,247 103.8%
RPK Total (000) 99,027 5.2% 215,429 -12.5%
Passengers carried 31,253 47.9% 55,952 8.6%
Cargo revenue tonne km (000) 240,478 -53.3% 478,719 -59.6%
Cargo carried (000kg) 65,126 -20.9% 139,367 -27.1%
Number of flights 993 3.6% 2,333 5.3%

 

CATHAY PACIFIC CAPACITY

FEB % Change Cumulative %

Change

  2022 VS FEB 2021

 

FEB 2022 YTD

 

ASK (000)        
 – Chinese Mainland 87,412 140.0% 176,634 112.4%
 – North East Asia 11,440 -71.0% 19,815 -77.6%
 – South East Asia 19,650 -77.8% 43,017 -78.1%
– South Asia, Middle East  & Africa 2,826
 – South West Pacific 27,219 -84.9% 54,389 -88.9%
 – North America 30,304 -88.8% 123,193 -83.7%
 – Europe 31,861 -49.5% 76,533 -63.9%
ASK Total (000) 207,886 -69.4% 496,407 -72.8%
Passenger load factor 47.6% 33.8pt 43.4% 29.9pt
Available cargo tonne km (000) 298,799 -53.8% 609,763 -59.1%
Cargo load factor 80.5% 0.9pt 78.5% -1.0pt
ATK (000) 318,677 -55.2% 657,190 -60.5%

 

Cathay Pacific to cancel some passenger flights in January amid tougher curbs

 

From Reuters:

“Cathay Pacific Airways Ltd will cancel some passenger flights in January because of operational and travel curbs at a time when the Asian financial centre has tightened quarantine requirements, the airline said on Wednesday.”

Read the full article:

https://www.reuters.com/business/aerospace-defense/cathay-pacific-cancel-some-passenger-flights-jan-amid-tougher-curbs-2021-12-22/

In other news, Cathay Pacific has added HBO MAX to every seast starting on January 1, 2022:https://twitter.com/cathaypacific/status/1441261454796091398?s=20

Cathay Pacific reports an increase in passengers from 2020, but still far below 2019

Cathay Pacific has released its traffic figures for November 2021 that continued to reflect the airline’s substantial capacity reductions in response to significantly reduced demand as well as travel restrictions and quarantine requirements in place in Hong Kong and other markets amid the ongoing global COVID-19 pandemic.

Cathay Pacific carried a total of 70,047 passengers last month, an increase of 85.2% compared to November 2020, but a 97.3% decrease compared to the pre-pandemic level in November 2019. The month’s revenue passenger kilometers (RPKs) rose 87.1% year-on-year, but were down 96% versus November 2019. Passenger load factor increased by 8.2 percentage points to 26.8%, while capacity, measured in available seat kilometers (ASKs), increased by 29.5%, but remained 88.2% down on November 2019 levels. In the first 11 months of 2021, the number of passengers carried dropped by 86.4% against a 65.1% decrease in capacity and an 82.1% decrease in RPKs, as compared to the same period for 2020.

The airline carried 135,350 tons of cargo last month, an increase of 15.8% compared to November 2020, but a 23.9% decrease compared with the same period in 2019. The month’s cargo revenue tonne kilometers (RFTKs) rose 15.5% year-on-year, but were down 14% compared to November 2019. The cargo load factor increased by 4.3 percentage points to 82.6%, while capacity, measured in available cargo tonne kilometers (AFTKs), was up by 9.5% year-on-year, but was down 28.6% versus November 2019. In the first 11 months of 2021, the tonnage decreased by 1.1% against a 12.5% drop in capacity and a 2.3% decrease in RFTKs, as compared to the same period for 2020.

Cathay Pacific’s traffic is still down 95.3% compared to the pre-pandemic level in August 2019

Cathay Pacific Airways Airbus A350-1041 B-LXJ (msn 286) AMS (Ton Jochems). Image: 955154.

Cathay Pacific Airways made this announcement:

Cathay Pacific has released its traffic figures for August 2021 that continued to reflect the airline’s substantial capacity reductions in response to significantly reduced demand as well as travel restrictions and quarantine requirements in place in Hong Kong and other markets amid the ongoing global COVID-19 pandemic.

Cathay Pacific carried a total of 135,353 passengers last month, an increase of 278.4% compared to August 2020, but a 95.3% decrease compared to the pre-pandemic level in August 2019. The month’s revenue passenger kilometers (RPKs) rose 294.1% year-on-year, but were down 92.4% versus August 2019. Passenger load factor increased by 26.5 percentage points to 46.4%, while capacity, measured in available seat kilometers (ASKs), increased by 68.9%, but remained 86.9% down on August 2019 levels. In the first eight months of 2021, the number of passengers carried dropped by 92.2% against a 76.2% decrease in capacity and an 89.7% decrease in RPKs, as compared to the same period for 2020.

The airline carried 124,278 tons of cargo and mail last month, an increase of 21.7% compared to August 2020, but a 23% decrease compared with the same period in 2019. The month’s revenue freight tonne kilometers (RFTKs) rose 20.7% year-on-year, but were down 15.4% compared to August 2019. The cargo and mail load factor increased by 2.3 percentage points to 77.7%, while capacity, measured in available freight tonne kilometers (AFTKs), was up by 17.2% year-on-year, but was down 33.8% versus August 2019. In the first eight months of 2021, the tonnage decreased by 8.7% against a 21.8% drop in capacity and a 10.9% decrease in RFTKs, as compared to the same period for 2020.

Passenger

Chief Customer and Commercial Officer Ronald Lam said: “While the COVID-19 situation continues to present us with considerable challenges, we did see some improvement in the performance of our passenger business in August. Overall, passenger capacity increased 81% compared with July, although we still only operated about 13% of our August 2019 pre-pandemic levels. Load factor reached 46.4% – the highest it’s been since March 2020.

“August’s passenger performance was driven primarily by student traffic, in particular from the Chinese Mainland to the US. We cautiously increased capacity on these services, with our Shanghai flights notably increasing to three times per day from mid-August, while our New York, San Francisco and Los Angeles flights also saw capacity increases. We also resumed flights to Chicago and Boston, which generated strong demand.

“Meanwhile, demand for student travel from Hong Kong and the Chinese Mainland to the UK also gradually picked up from mid-August. This included not only our London flights, but our newly resumed Manchester services. Other newly resumed services in August included Paris, Phuket and Qingdao.

“From early August, we were able to resume flights from the UK to Hong Kong, although the inbound demand was relatively weak. In general, inbound traffic slowed down after 20 August when the Hong Kong SAR Government tightened quarantine requirements for travelers arriving in Hong Kong from 16 overseas places.

Cargo

“While August is traditionally a quieter month for cargo due to the summer holiday period in the Northern Hemisphere, this was not the case this year and demand continued to be buoyant both from our home market, Hong Kong, and from across our network. Cargo capacity increased about 9% month-on-month, reaching approximately 66% of our August 2019 pre-pandemic levels.

“Towards the end of the month our freighter schedule ramped up to peak season levels, with transpacific flights notably increasing to 39 flights per week. Two additional Boeing 777 “preighters” have also now entered into service, bringing our total to six, providing us with additional capacity for carrying cargo.

“At the same time, our teams have been agile in responding to the constantly changing operating environment brought on by the COVID-19 outbreaks in various parts of our network. This has particularly impacted our services to Shanghai, where authorities have increased quarantine requirements for ground staff to contain the situation.

Outlook

“Our August passenger performance, with capacity at about 13% of pre-pandemic levels, was an improvement over previous months. We had hoped to operate as much as 30% of pre-pandemic capacity by the fourth quarter of 2021. However, operational and passenger travel restrictions remain in place, continuing to constrain our ability to operate more flights. As such, we now only expect to maintain similar passenger capacity levels to August 2021 for the remainder of the year, whilst remaining responsive to any unexpected changes in travel restrictions. We maintain our focus on prudent cash management, targeting cash burn of less than HK$1 billion per month for the rest of 2021.

“For cargo, market indicators suggest a strong peak season driven by the need for inventory replenishment, against a backdrop of ongoing air capacity constraints and disruptions to supply chains due to seaport congestion. We are planning for this, whilst remaining vigilant regarding changes to the COVID-19 situation that could impact operations.

“Despite our short-term challenges, we remain committed to keeping our home city connected to the world via the Hong Kong international aviation and logistics hub.”

 

AIRLINES COMBINED TRAFFIC

AUG

 

2021

% Change

VS AUG 2020

Cumulative

 

AUG 2021

%

Change

YTD

RPK (000)        
 – Chinese mainland 72,325 1,179.3% 153,370 -80.1%
 – North East Asia 10,670 95.0% 45,771 -97.7%
 – South East Asia 17,596 5.4% 128,577 -94.5%
– South Asia, Middle East  & Africa 7,638 16,446 -98.9%
 – South West Pacific 18,479 -21.3% 105,968 -96.6%
 – North America 609,751 563.4% 1,123,978 -79.6%
 – Europe 140,598 77.2% 388,373 -90.0%
RPK Total (000) 877,057 294.1% 1,962,483 -89.7%
Passengers carried 135,353 278.4% 346,589 -92.2%
Cargo and mail revenue tonne km (000) 783,031 20.7% 4,838,080 -10.9%
Cargo and mail carried (000kg) 124,278 21.7% 795,366 -8.7%
Number of flights 1,844 59.4% 9,800 -45.6%

 

AIRLINES COMBINED CAPACITY

AUG

 

2021

% Change

VS AUG 2020

Cumulative

 

AUG 2021

%

Change

YTD

ASK (000)        
 – Chinese mainland 127,887 291.9% 450,864 -65.6%
 – North East Asia 58,451 69.9% 347,128 -88.6%
 – South East Asia 97,559 2.3% 629,461 -83.7%
– South Asia, Middle East  & Africa 28,144 76,348 -96.6%
 – South West Pacific 313,691 174.7% 1,529,852 -66.8%
 – North America 951,932 62.3% 3,032,518 -65.5%
 – Europe 314,100 22.4% 1,036,403 -82.7%
ASK Total (000) 1,891,764 68.9% 7,102,574 -76.2%
Passenger load factor 46.4% 26.5pt 27.6% -36.4pt
Available cargo/mail tonne km (000) 1,007,351 17.2% 5,986,775 -21.8%
Cargo and mail load factor 77.7% 2.3pt 80.8% 9.9pt
ATK (000) 1,187,577 22.9% 6,662,881 -36.5%

Top Copyright Photo: Cathay Pacific Airways Airbus A350-1041 B-LXJ (msn 286) AMS (Ton Jochems). Image: 955154.

Cathay Pacific Airways aircraft slide show: