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Cathay Pacific Group’s CCO says recovery impossible to predict
April 17th 2020
Cathay Pacific Airways Group Chief Customer and Commercial Officer, Ronald Lam, said on Thursday forward bookings remain low with no recovery in sight amid almost non-existent demand. Read More »
The airline group's monthly traffic report showed Cathay Pacific and its regional wing, Cathay Dragon, carried 311,128 passengers in March, down 90% from 4.3 million passengers 12 months earlier.
Passenger load factor dropped 34.6 percentage points, to 49.3%, the airline group said in a regulatory filing to the Hong Kong stock exchange on April 16.
To illustrate the collapse in demand, Lam said Cathay Pacific normally would carry about 100,000 passengers a day across its network. On a day earlier in April, there were only 302 passengers on its flights.
“As the economic impact of the global COVID-19 pandemic is intensifying, a recovery timeline in our customer demand remains impossible to predict," Lam said.
"We still do not see an improvement in our advance passenger bookings and we are anticipating average daily passenger numbers to remain below 1,000 throughout April."
Lam said Cathay Pacific would continue to operate a "bare skeleton passenger flight schedule" equivalent to about 3% of the airline's normal capacity. This was part of efforts to reduce expenditure and preserve cash for the coming months.
The most significant decline was on the airline group's Northeast Asia routes, where demand, measured by revenue passenger kilometres [RPK], plummeted 96.6%. On Mainland China routes, RPKs were 95.9% lower in the month.
Cathay Pacific said it is continuing to operate a full freighter schedule. While overall cargo capacity, measured by available tonne kilometres [ATK], declined 37.2% in March, load factor rose nine percentage points, to 77.4%, due to the air cargo capacity reduction in the global market. Cargo yields also were higher in the month, Lam said.
“To support global supply chains at this critical time, we have been adding cargo capacity in the form of more freighter flights as well as a total of 257 pairs of cargo-only passenger flights in March," Lam said.
"Currently, we expect to operate a similar number of cargo-only passenger flights in April, including on some long-haul routes such as the Southwest Pacific where air cargo capacity is extremely tight."
Lam added the resumption of production in mainland China had led to a rebound in exports from Hong Kong and mainland China, following a weaker February. Other shipments were negatively impacted by lockdowns and emergency measures in markets such as India during the second half of the month, he said.
