Hong Kong Airlines Update

Transcript

Michael Burke:We introduced some services to Gold Coast and Cairns 3 times a week from Hong Kong earlier this year. Initially, they were on a charter basis just for the first 2 or 3 months to cover Chinese New Year. We've moved them very quickly to scheduled service, and we've seen the mix of passengers move also very quickly from About 30% group to down to only about 15% to 20% group now. So we're very happy with how forward sales are going, and we're looking already to increase frequency. When we think of Hong Kong, we look at the whole catchment area of the Pearl River Delta. So really, the catchment area for Hong Kong Airport is about 40 million people. So we don't really just view it as Hong Kong itself, but we're getting the majority of our customers from the mainland of China, obviously leveraging our very extensive Network, which is the whole point of why we're looking to develop Australia service, to be able to use Hong Kong more effectively as a hub across our network. It's exciting. The simple answer is we don't yet know. Obviously, until we have the necessary regulatory things in place, we are not able to talk about the detail. So as and when we are, we can explore exactly what that's going to look like, but it should be exciting to leverage the— not just our own network through Hong Kong, but also the broader HNA domestic China network from the north carrying passengers south, and then Virgin Australia domestically in Australia. So that's quite a compelling proposition to the customer. Whilst we have the bilateral constraints in place, but there is a compelling desire for growth, which there is out of Hong Kong, we are absolutely talking to other airports to look at how we can profitably make more secondary points work. By default, they are smaller, more niche opportunities, so we have to be very creative in how we serve those markets. But again, the deal with Virgin Australia potentially allows us to work together to develop those markets, to make them much more commercially viable. Probably not positive. I believe this morning that there's not much prospect of further talks between Australia and Hong Kong. But the great thing about commerce and industry is companies find a way around what what we feel is a very unfair restriction and one which is in no way in the interests of the consumer. And, you know, there are creative ways around most restrictions if you have the will and the desire, and Qatar Airways, we're talking about similar, you know, willpower to get around these things. And, you know, we have a strong parent company who's similarly creative. Auckland, yeah, so we start Auckland on 10th of November this year, and that's been for sale now for about 6 or 7 weeks, and we're very happy with how forward sales are going. We're seeing— it's difficult to say with any certainty because we don't have a Europe or US network yet, But what we believe we're seeing is kind of a shift across to the Auckland service and our Australia service from Europe. Bookings out of the mainland of China in particular viewing Australia and New Zealand together as more of a safe haven kind of status destination. And so we're seeing quite a surge in bookings of late. on the Auckland service, which— and that's what we believe it to be.

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