The reduced available capacity of Cathay Pacific due to recently implemented travel restrictions and strict crew quarantine measures are expected to impact its cash burn by HK$1.0 to 1.5 billion per month, the airline said on January 24. And that’s just a preliminary assessment of the situation from February. Restrictions cost Cathay Pacific up to HK$1.5 billion per month.
“Until conditions improve, we are doing everything in our power to maximize capacity, and estimate that mitigation measures to increase crew resources will enable us to operate approximately an additional five percent more cargo flight capacity than we are currently operating”, CEO Augustus Tang says in a media statement.
The Hong Kong SAR government has imposed travel restrictions on eight countries on January 8. While they were to last for two weeks, restrictions have been extended and other countries added to the list. All Hong Kong-based cargo crew has to self-quarantine for three days in designated hotels. The combined effect is a drastic reduction in available flights and crew. Cathay has reduced its capacity for passenger flights from ten to just two percent, while cargo flights operate at twenty percent of pre-pandemic levels.
The carrier continues to operate freighter service to China Mainland and North America, while it deploys passenger aircraft on cargo-only services to Europe and the Southwest Pacific. “On the travel side, we will strive to maintain passenger connectivity with key destinations, although at reduced frequencies, under the confines of the place-specific and flight-specific suspension mechanism.”
Cathay’s passenger services to China are unaffected, but those of subsidiary HK Express are leveraged but will be maintained to some regional destinations. “As Hong Kong’s home airline, we remain resolutely committed to keeping the city safely connected with the world. We are exploring all options to keep the flow of people and goods moving despite the considerable challenges we continue to face”, the carrier says.
Unaudited loss between HK 5.6 and 6.1 billion
Cathay’s unaudited results for 2021 show a HK$5.6 to 6.1 billion net loss compared to HK$21.6 billion in 2020. The result was preliminarily driven by strong yields from its cargo operations while at the same time strict cost management.
During December, Cathay carried 92.219 passengers, up by 130.6 percent from the same month in 2020 but still 96.9 percent down on 2019 levels. For the full year, the airline carried 717.059 passengers, -84.5 percent compared to 2020. Cargo carried was 1.3 million tons, up 0.1 percent from the previous year. At 4.1 million, revenue passenger kilometers (RPKs) were down by 79.5 percent. Cargo revenue tons kilometers were 1.1 percent down to 8.2 million. Capacity in available seat kilometers (ASK’s) ended at 13.2 million, down 61.8 percent.
