More passengers for Cathay, but still a long way behind

Top News | Aiden He and Bloomberg 20 Oct 2021

Cathay Pacific says it carried 131,774 passengers last month - an increase of 1.8 times year-on-year - but it was still a 94.6 percent decrease compared to the prepandemic level.

In the first nine months of 2021, the number of passengers carried dropped by 89.4 percent against a 71.7 percent decrease in capacity, compared to the same period for 2020.

On September 17, the airline carried a total of 6,562 passengers, the most for a single day since late March 2020. Nevertheless, it still operated only at 13 percent of its passenger capacity and 70 percent of cargo capacity when compared to September 2019, said chief customer and commercial officer Ronald Lam Siu-por.

Lam said that passengers traveling within Asia via Hong Kong were a key driver of demand. Passenger demand for flights into Hong Kong remained weak due to strict quarantine requirements.

In terms of cargo, Cathay Pacific carried 130,997 tonnes of cargo and mail last month, up by 19.7 percent from a year ago, but down 24.1 percent compared with the same period in 2019.

Cargo demand continued to grow with the traditional cargo peak season, Lam said. He expects demand to remain robust, driven by the movement of new consumer products and the urgent need for inventory replenishment due to supply-chain constraints.

Meanwhile, a new airline with ties to Beijing is trying to muscle into Hong Kong.

Founded by property magnate Bill Wong Cho-bau, Greater Bay Airlines has ambitions to fly to 104 destinations in the mainland and north, south and southeast Asia, including Bangkok and Phuket. Scheduled flights have not begun yet, with the carrier receiving its air operator's certificate only at the beginning of the month and an air-transport license still to be procured.

Wong, 62, dubbed the Li Ka-shing of Shenzhen for his expansive business empire across the border, already owns one carrier, Shenzhen-based Donghai Airlines, which serves Chinese cities as well as a few regional routes.

Greater Bay Airlines' entry into Hong Kong also comes at a low point for Cathay.

With no domestic market and the mainland's borders still closed even to Hong Kong, Cathay's passenger traffic languishes at about 5 percent of prepandemic levels.

"We're starting from new, so we don't have the burden or the baggage," said Greater Bay Airlines' chief executive, Algernon Yau, suggesting that Covid has leveled the playing field.

Cathay seems unperturbed by the potential for more competition. "There's a wealth of potential for both business and leisure travel as the region continues to develop," a spokesperson said.

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