Flag service Cathay Pacific predicts flight provide to return to ‘regular’
HONG KONG: Hong Kongers can anticipate decrease airfares this 12 months, with the town’s flag service Cathay Pacific Airways predicting costs will return to regular as provide of flights enhance.
The airline made the upbeat forecast about cheaper airfares amid rising calls from lawmakers for the corporate to cut back ticket costs, after it had posted HK$9.78 billion (45.33 billion baht) internet revenue final 12 months.
Showing earlier than the Legislative Council’s financial growth panel on Friday, Cathay’s common supervisor for planning Erica Peng acknowledged the town’s airfares had been elevated as a result of unbalanced provide of flights after worldwide journey resumed final 12 months.
Peng added that airfares had been prone to “normalise” within the coming 12 months as a rise within the provide of flights would scale back the shortfall, though she didn’t verify if the service would reduce costs.
“Together with the development in provide of capability, Hong Kong’s airfares have began to normalise,” she mentioned.
“We’ll work arduous to extend capability and we anticipate our ticket costs might be again to regular within the coming 12 months.”
Cathay CEO Ronald Lam Siu-por mentioned the service would return to 80% of pre-Covid capability by the tip of the second quarter of this 12 months and 100% within the first quarter of 2025, regardless of a three-month delay to the latter goal.
Lam additionally vowed to introduce extra concessionary airfares as a token of appreciation of individuals’s assist.
“We have rolled out every so often some promotional airfares and we’ll proceed to take action to thank Hong Kong residents,” he mentioned.
At Friday’s session, a number of lawmakers complained about Cathay’s excessive airfares and referred to as for the airline to cut back costs.
“Prior to now few years, your airfares have been too costly. How will you give again to the neighborhood?” requested lawmaker Jeffrey Lam Kin-fung, additionally a member of the federal government’s key decision-making Government Council.
New Individuals’s Social gathering lawmaker Eunice Yung Hoi-yan requested: “Some have mentioned Cathay’s airfares are overpriced. Any likelihood to chop costs?”
Mayur Patel, head of Asia for aviation analytics agency OAG, mentioned he anticipated that airfares would additional normalise with elevated capability.
“As we transfer ahead in 2024, we are going to see additional normalisation of yields as capability is added to the market,” he mentioned.
Patel additionally highlighted that Cathay operates in a aggressive area. Hong Kong-Taipei was ranked because the busiest route whereas Hong Kong-Bangkok got here in at No 8, he mentioned citing details about the highest 10 busiest worldwide routes for March 2024 from the agency’s database.
Impartial aviation analyst Brendan Sobie mentioned whereas airfares had been a operate of provide and demand, it was nonetheless unpredictable. “Even for those who see provide going up, it is arduous to foretell demand. There are a lot of different elements,” he mentioned.
On-line searches by the South China Morning Submit for Cathay’s return economy-class tickets between Hong Kong and London, a preferred route with Hongkongers, confirmed costs of about HK$6,300 to HK$11,000 in April.
A return economy-class ticket to New York the identical month had been priced between HK$15,000 and HK$32,000.
Cathay charged a mean US$452 (HK$3,534) for a one-way economic system class ticket excluding taxes and surcharges on the Hong Kong-London route in 2023, 8.8% decrease than the typical of US$496 in 2022 however nonetheless 46.2% increased than US$309 in 2019, based on statistics by aviation agency Cirium Ascend Consultancy.
Utilizing the identical parameters, Cathay’s air fare on the route was 7.3% increased than British Airways’ common of US$419 final 12 months. The British Airway’s determine was much like its common of US$411 in 2022, however increased than US$372 in 2019.
Worldwide Air Transport Affiliation, the commerce physique for airways, predicted in December that the passenger yield of worldwide business carriers in 2024 would contract to 1.8% from an estimate of 6.2% in 2023, reflecting the probability of decrease airfares.
