Cathay Pacific explores new growth opportunities as pressure mounts in traditional markets

Cathay Pacific's short-term focus is regional Asia, which it will continue to grow in 2013, although overall the airline expects a slight decrease in capacity as it looks to improve profitability on its long-haul network by replacing maintenance-intensive 747-400s with new 777-300ERs.

But in the long-term the carrier's focus is very much on leveraging its short-haul network to feed long-haul flights, meanwhile re-examining its short-haul strategy.

Cathay is once again evaluating the A380 and 747-8I to see if it needs to grow through capacity increases, stick to its preference for frequency and/or consider new destinations many of its passengers currently reach via connections. The airline is also considering how it might tap into the lucrative Asia-Latin America market. And of course, Cathay must consider what role it will have with alliances.

Yet underpinning these growth possibilities is the fact that Cathay's short-haul market is under pressure, and this will only intensify as Chinese airlines and LCCs continue to gain strength in its home market - an uncomfortable reality Cathay has been shy of admitting.