Cathay Pacific to Operate 3% of Normal Capacity in April and May 2020

Cathay Pacific and Cathay Dragon carried a combined total of 311,128 passengers in March, a decrease of 90% when compared to March 2019.

The month’s RPK also fell 84.3% year-on-year. Passenger load factor slid by 34.6 percentage points to 49.3%, while capacity, measured in available seat kilometres (ASK), decreased by 73.2%.

Cathay Pacific Group Chief Customer and Commercial Officer, Ronald Lam, said, “Overall, we carried 90% fewer passengers in March and 52% fewer passengers in the first quarter than we did in the same periods last year. Though we remained agile in aligning capacity with demand, our load factor for the month nevertheless dropped to 49.3% only. We saw significant declines across all traffic types, though the drop in inbound passenger traffic was lessened in the third week of March, when we reinstated 13 flights to help residents and students from the UK and the US returning to Hong Kong. Passenger demand dropped rapidly and tremendously in late March following the introduction of arrival restrictions on all non-resident visitors to Hong Kong, including transit passengers. On each of the last two days of March we carried fewer than 1,000 passengers only.”

The two airlines carried 119,277 tonnes of cargo and mail last month, a decrease of 35.6% compared to March 2019. The month’s revenue freight tonne kilometres (RFTK) also fell 29% year-on-year.

The cargo and mail load factor increased by 9 percentage points to 77.4%, while capacity, measured in available freight tonne kilometres (AFTK), was down by 37.2%.

“While we continue to operate a full freighter schedule, our passenger flight reductions have had a significant impact on our overall cargo capacity. Our cargo volumes were down, but load factors and yield were up due to air cargo capacity reduction in the global market,” said Mr. Lam. “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. We currently 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. The resumption of production in mainland China saw exports from our home market Hong Kong and the mainland rebound following a weaker February. However, other transshipments were negatively impacted by lockdowns and emergency measures in various markets in the second half of the month, in particular the India sub-continent. Our commodity mix also changed with a surge in the transportation of medical supplies such as face masks, protective clothing, hand sanitiser and other pharmaceutical products. On the other hand, the volume of consumer goods such as garments and automobile parts declined.”

Outlook

“As the economic impact of the global COVID19 pandemic is intensifying, a recovery timeline in our customer demand remains impossible to predict,” Mr. 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. On a typical day we would normally expect to carry some 100,000 passengers; earlier this week, this had dropped to 302 only on one day. In April and May, we will be operating a bare skeleton passenger flight schedule comprising 3% of our normal capacity. We are doing everything we can to reduce our expenditure and preserve cash for the coming months. We are exploring all options to ensure that the Cathay Pacific Group rides out this current storm, and is able to compete vigorously and to help Hong Kong recover when we emerge from this crisis.”

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