Following Airways Aviation News‘ latest update on Cathay Pacific’s business outlook more than a month ago, the time which Cathay Pacific Chief Executive Officer (CEO) Tony Tyler lamented that the Hong Kong-based carrier will see the first sign on whether there will be a pickup in premium demand or not, has finally arrived.
However, Cathay Pacific said it was uncertain on a structural recovery, despite it has posted its best load factor figure so far this year at 83% in the last week of September to the first week of October.
“There have been signs in recent months of a pickup in our passenger business, but on the basis of reduced capacity. We are seeing reasonably solid loads in Economy Class, but mainly driven by competitive fares in the marketplace,” Cathay Pacific spokeswoman Carolyn Leung reaffirms.
Image Owned by Airways Aviation News
Regarding the premium traffic from which Cathay Pacific and many other legacy carriers generate a big proportion of their profits from, Leung says:
“There has also been a slight pickup in corporate sales and advance bookings in the front-end.
“As for the market outlook, things are still very fluid. At the moment it’s still hard to gauge if this pickup is simply a result of seasonal firmness or if we are indeed seeing the first signs of a structural recovery,” Leung stresses.
Indeed, Cathay Pacific has good reasons to doubt whether this pickup in passenger demand is just a mirage or not, particularly it has been hard hit by the global financial crisis which saw its yields plummeted 19.7% for the 1st half of this year (“Cathay posts HK$812 million 09 first-half profit“, 5th Aug 09).
After all, being relatively conservative about a structural recovery while observing the market trends closely and responding to them quickly, is the key to survival.
Moreover, Cathay Pacific has already taken every necessary measure to weather this industrywide crisis and emerge as an even stronger player.
Cathay Pacific has set up a team to gauge if this crisis will lead to a structural shift in demand or not.
However, Cathay Pacific spokesman Carolyn Leung emphasizes that there is “no fixed timeframe” to reach a decision over this.
Image Courtesy of Boeing
Meanwhile, Cathay Pacific has already parked 1 Boeing 747-400 and 3 A340-300s according to its plan to park 2 of the former type of aircraft and 4 of the latter (“Exclusive: Cathay is to withdraw 4 A340-300s, 2 B747-400s“, 3rd Jul 09).
Airways Aviation News predicts that Cathay will have to park more passenger aircraft in 2010 for the capacity to stay flat, given that it is to receive 2 Boeing 777-300ERs in the 4th quarter this year, 5 more 777-300ERs and 2 Airbus A330-300s in 2010.
“Apart from what has been announced, there is no further plan at the moment [to park more passenger aircraft],” Cathay Pacific spokeswoman Carolyn Leung clarifies.
A point which is noteworthy is, the 4 Boeing 747-8F freighters that were originally slated for delivery next year won’t be delivered on time following Boeing’s announcement last week over another 3-month B747-8F delivery delay (“Boeing faces yet another setback with US$1bln program charge“, 6th Oct 09).
This latest delay may prove to be a relief for the carrier, which has been seeking to postpone some of its B747-8F deliveries to 2014, according to Airways Aviation News‘ source.
On the other hand, Leung says “there is no plan at the moment” neither for raising additional capital following its recent sale of 12.45% HAECO stake, nor emulating the sale-and-leasback deal for the 6 A330-300s and 10 B747-8Fs that are on order (“Cathay announces HAECO stake sale, sale & leaseback deal with BOC Aviation“, 16th Sep 09).