Cathay Pacific and its subsidiary, Cathay Dragon, are imposing very significant capacity reductions throughout their network in response to the outbreak of COVID-19. The Hong Kong-based airline group will only operate 4% of scheduled passenger flights due to the falling demand and government-imposed travel restrictions around the world.
In total, Cathay Pacific is set to operate three weekly flights to 12 destinations from Hong Kong International Airport (HKG), including Bangkok Suvarnabhumi Airport, Thailand (BKK), London Heathrow Airport (LHR), Los Angeles International Airport (LAX), Tokyo Narita International Airport (NRT), Singapore Changi Airport (SIN), and Sydney Airport (SYD), amongst other routes.
Meanwhile, Cathay Dragon will fly three weekly flights to only three destinations: Beijing Capital International Airport (PEK), Kuala Lumpur International Airport, Malaysia (KUL) Shanghai Pudong International Airport (PVG).
The Cathay Pacific Group, which also includes Hong Kong Express, a local low-cost carrier, has faced numerous challenges in the past year. The Hong Kong protests, which started in March 2019, have severely impacted the carrier’s ability to stabilize its financial situation as it was amidst a turnaround plan, initiated in 2017 with the goal to enact a stable financial foundation by the end of 2019.
The airline saw dwindling demand for travel in and out of Hong Kong due to the unrest, replacement of its executives, including the long-standing former executive and now-former chairman John Slosar.
On March 11, 2020, the group announced its financial results for 2019. While the year was certainly difficult for the airline, it still managed to publish a net profit of $206 million (HK$1.6 billion), compared to a net profit of $296 million (HK$2.3 billion) in 2018.
Chairman of Cathay Pacific Patrick Healy stated that the airline expected an extremely challenging first half of 2020, however, the outbreak of COVID-19 exacerbated the difficulties going ahead further.
“We expect our passenger business to be under severe pressure this year and that our cargo business will continue to face headwinds,” added Healy.
But freight business is seemingly becoming a beacon of hope in the airline’s operations. Healy noted that Cathay is “cautiously optimistic” as the trade war between the United States and China has cooled down, thus the airline has maintained its cargo capacity for now.
Furthermore, the airline has ramped up its cargo capacity by “mounting charter services and operating certain suspended passenger services purely for airfreight to meet cargo customer demand,” as highlighted by Cathay Pacific Chief Customer and Commercial Officer Ronald Lam on March 20, 2020.