Cathay Pacific notes importance of China market, notes propensity to 'trade-up' to premium ravel
Cathay Pacific CEO John Slosar, speaking on the sidelines of CAPA's World Aviation Summit in Hong Kong, stated (29-Nov-2012) the carrier sees China as an extremely important market and has placed a lot of attention there. Mr Slosar reported China’s outbound travel is estimated to reach 78 million this year and increasing to 122 million passengers p/a by 2020, which will be a big opportunity not just for China’s domestic carriers but also airlines operating to China. More importantly, according to Mr Slosar, the carrier sees Chinese consumers’ increasingly high propensity to “trade-up” as being a strong premium opportunity for the carrier, not just the business end of the market but also the leisure end of the market. One of the reasons Cathay entered into cross-shareholding partnership agreement with Air China in 2006 was based on the recognition of a need to have a China network to respond to the growth it is seeing now. He also said 2012 has been quite an “ok” year but the general feeling about outbound travel in China in 2013 is quite positive. For Cathay, premium outbound travel from China doubled from 2008 to 2012. The carrier has also been quite successful in growing corporate deals in China, up by 33% in 2012. Around 50% of traffic from corporate deals is for premium. The way China is developing as a premium market is different to other markets around the world.