Cathay Pacific: Summer peak 'didn't quite live up to expectations', premium demand remains weak

Cathay Pacific, in the Sep-2012 edition of CX World Magazine, stated (Sep-2012) after a disappointing first half for the passenger business, and a summer peak that "didn't quite live up to expectations, the question now is whether the traditional peak period for business travel can deliver". The carrier noted traffic usually begins to pick up from September and peaks in October, boosted by events such as the Canton Fair. General manager revenue management James Tong says in the core Hong Kong market, booking growth generally looks reasonable in the coming months, though the front end is still lagging behind capacity growth in Sep-2012. "The main area of concern for our premium business remains key corporate destinations such as London, New York, Beijing and Shanghai, where we are seeing the total market size shrinking," he said, adding, "We expect it to stay that way in view of the gloomy economic outlook." The summer peak saw high passenger numbers across the network, but overall load factor dropped below the same period in 2011. More capacity was operated but yield continued to be under pressure in all cabins as a result of intense competition in many markets. Mr Tong said, "Efficiency - revenue per ASK - was down overall with the most noticeable drop being seen in the front-end cabin on short-haul routes." In autumn 2013, Cathay Pacific will implement capacity reductions on a number of key long-haul routes, mainly driven by the need to reduce the 747 operations. "The traffic volume is expected to fall below last year's levels though we expect to see a slight improvement in load factor and yield - and hopefully positive efficiency growth - in the last quarter," Mr Tong said. [more - original PR]