Cathay sees a buoyant intra-Asia fuelled by perishables, auto-parts

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The Cathay Pacific Group continues to see cargo vastly outperforming its passenger business in October, with a “buoyant” intra-Asia seeing strong perishables and rising auto-parts.

“As has been the case for most of this year, our cargo business continues to be the better performer,” says Cathay Pacific Group chief customer and commercial officer Ronald Lam.

“Following the National Day Holidays at the beginning of October, demand from our home market, Hong Kong, and the Chinese mainland rebounded quickly, driven by new electronic products.”

Lam noted that return traffic from the Americas and Europe also improved month-on-month, and Intra-Asia traffic was “buoyant with solid perishable goods movements and some signs of a recovery in auto-parts traffic”.

To cater to this demand, Cathay’s freighter fleet continued to operate at full capacity, supplemented by 576 pairs of cargo-only passenger flights – about 10 per cent more than it operated in September.

“Despite this additional capacity, the average load factor reached its highest point so far in 2020 at 78.3 per cent. We also continued to add to our specialised products capability with the introduction of a Skid-Size Fire Containment Bag solution, enabling the safe transport of lithium-ion batteries packed on skids. This solution will be progressively rolled out across our network,” Lam adds.

Cathay Pacific and Cathay Dragon (which ceased operation on 21 October 2020) carried a total of 114,346 tonnes of cargo and mail last month, a decrease of 37.6 per cent compared to October 2019.

The month’s revenue freight tonne kilometres (RFTKs) fell 30.2 per cent year-on-year. The cargo and mail load factor increased by 10.4 percentage points to 78.3 per cent, while capacity, measured in available freight tonne kilometres (AFTKs), was down by 39.4 per cent.

In the first 10 months of 2020, the tonnage fell by 34.3 per cent against a 35.4 per cent drop in capacity and a 27.3 per cent decrease in RFTKs, as compared to the same period for 2019.

Passenger numbers continued to take a beating with the two carriers uplifting 38,541 passengers last month, a decrease of 98.6 per cent compared to October 2019. The month’s revenue passenger kilometres (RPKs) fell 98 per cent year-on-year.
In the first 10 months of 2020, the number of passengers carried dropped by 84.6 per cent against a 76.5 per cent decrease in capacity and an 82.6 per cent decrease in RPKs, as compared to the same period for 2019.

Looking forward, the carrier along with Singapore Airlines, both welcomed the news earlier this week of the introduction of an all-purpose, two-way, quarantine-free Hong Kong-Singapore Air Travel Bubble from 22 November.

“This is a hugely encouraging development and an important first step in the return of regular international air travel to and from Hong Kong,” Lam notes.

But Lam adds that aside from the travel bubble, the pickup in passenger demand otherwise in November has remained sluggish with stricter quarantine requirements in place in Hong Kong.

“We remain in a very dynamic situation and overall recovery is anticipated to be slow. As we have previously announced, we expect to operate well under 25 per cent of 2019 passenger capacity in the first half of 2021 and below 50 per cent for the entire year.”

 

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