Cathay Pacific concerned that HK has lost competitiveness

REPORT: AVIATION Cathay Pacific concerned that HK has lost competitiveness

But confident that the city can rebound as an international aviation hub.

There needs to be a “clear roadmap showing the complete removal of all COVID-related restrictions for crew and passengers as soon as is feasible” (Photo from CathayPacific.com)

Hong Kong is no longer the internal aviation hub it used to be, and it will not be able to bring back its crown unless the government “does more,” according to Cathay Pacific.

“Hong Kong is rapidly losing its competitiveness and connectivity, whereas our regional competitors have recovered much faster from the disruptions caused by the global pandemic,” a spokesperson for Cathay Pacific told Hong Kong Business.

The spokesperson added that whilst the airline welcomes the government’s recent adjustment to the quarantine arrangements for inbound travellers, there needs to be a “clear roadmap showing the complete removal of all COVIDrelated restrictions for crew and passengers as soon as is feasible.”

In August, the city cut down its hotel quarantine period for all arrivals from seven days to three days. This limited the airline in adding more flight capacity despite the growing pent-up demand.

Hong Kong is rapidly losing its competitiveness and connectivity

Initially, the airline plans to operate a quarter of its prepandemic passenger flight capacity and 65% of its pre-pandemic cargo flight capacity by December. As of July, Cathay Pacific was operating just 12.4% of its pre-pandemic passenger flight capacity and 51% of its cargo flight capacity.

Apart from limiting aviation players, continued restrictions delay the fruition of China’s National 14th Five-Year Plan, which include strengthening Hong Kong as an international aviation hub.

Hopes for takeoff

Cathay Pacific, however, has not lost hope in the aviation industry, saying that the recent commencement of flight operations on the Third Runway at Hong Kong International Airport (HKIA) gave the airlines “great confidence for the long-term future of the hub.”

The airlines’ confidence in the future of Hong Kong’s aviation industry was shared by the HKIA.

“Despite the challenges posed by the pandemic, [Airport Authority Hong Kong (AAHK)] is confident in the long-term development of the aviation industry and the hub function of HKIA,” a spokesperson from the airport told Hong Kong Business.

HKIA projects

Apart from the return of flight operations on its Third Runway, HKIA said it also has a myriad of development projects lined up to support the aviation industry’s recovery. These projects include SKYCITY, which houses offices, hotels, Hong Kong’s largest retail, dining and entertainment complex.

Through these development projects, HKIA aims to raise its capacity and enhance its functionality, and eventually transform itself from a city air to an airport city.

Whilst passenger traffic is still on its path to recovery, HKIA said it is being supported by high demand for e-commerce and transportation of medical supplies.

“The efficient air cargo community has worked together to raise the capacity to cater to the demand, so as to consolidate our leadership position in a challenging environment,” the spokesperson said.

In 2021, HKIA saw a throughput of 5 million tonnes, making it the busiest airport in cargo operations in the world.

HKIA, however, underscored that it had already seen a gradual increase in passenger traffic following the government’s relaxation of the quarantine requirements for inbound travellers.

In July, HKIA welcomed a total of 401,000 passengers, representing a growth of 259.3% YoY. Combining the first seven months of 2022, the airport handled 1.2 million passengers, a 152.8% YoY jump.

On a 12-month rolling basis, the airport handled 2.1 million passengers, marking 127.0% yearon-year growth.

In response to the increase, HKIA said the AAHK has begun working with its partners to prepare for the recovery of flights and passengers.