Cathay to park one-third of planes abroad to cut costsFinance | Avery Chen 29 Jul 2020
Cathay Pacific Airways (0293) said yesterday it will transfer a third of passenger aircraft from Hong Kong in the coming months, the latest move to economize amid the Covid-19 crisis.
The carrier said the first batch of aircraft will land at Alice Springs in Australia for storage, and it is in discussion with facilities in other suitable locations. Local media said the company will send 12 aircraft of Cathay Pacific and Cathay Dragon to the Australian desert, starting this week.
Cathay Pacific and Cathay Dragon operated combined 182 passenger aircraft by December 31 last year, said Cathay's annual report. A third of aircraft means around 60 planes will be moved out of Hong Kong.
The aircraft being considered for transfer overseas come from different fleets. The parking of certain passenger aircraft outside of Hong Kong is expected to be for different durations to address asset preservation and operational needs, the company said.
"At present, our aircraft are parked at Hong Kong International Airport, primarily in remote bays, taxiways and other operational areas made available at the airport. We need to park these aircraft while they are not flying in locations beyond Hong Kong's humid climate," it said.
The Airport Authority has announced a full waiver of parking and airbridge fees for idle passenger aircraft from March to August.
Cathay has lowered overall passenger flight capacity to about 7 percent of the normal flight schedule for July and to up to 10 percent for August, as its airlines have carried less than 1 percent of the passenger numbers during the same period last year in the past few months.
These plans remain subject to the potential further relaxation or tightening of government health measures, the company said yesterday.
Earlier this month, Cathay warned it is set to record a net loss of about HK$9.9 billion for the first half, compared with a net profit of HK$1.3 billion a year ago.
Meanwhile, Hong Kong and Shanghai Hotels (0045) issued a profit warning yesterday due to widespread travel advisories and flight cancellations amid the pandemic. The hotel group expects to incur a net loss and underlying loss for the first six months this year, compared to a net profit of HK$254 million and an underlying profit of HK$148 million in the same period of 2019.