Downturn is touching bottom

Another cargo decline hit Cathay Pacific Airways and its sister company Dragonair in July, but it was smallest since the beginning of the year, showing that the downturn is touching bottom, say airline officials to the Shipping Gazette.

"Our July drop of 6.7 per cent was the smallest year-on-year monthly drop in 2009," said Cathay cargo chief Titus Diu. "Indications are that the massive slide in the air cargo market has bottomed out and we were encouraged to see an increase in demand out of our home market, Hong Kong."

The two airlines carried 133,233 tonnes last month, down 6.7 per cent year on year, while the cargo and mail load factor rose by 6.6 percentage points to 72.6 per cent as a result of the capacity decline, said a company statement.

Capacity for the month, measured in available cargo-mail tonne kilometres, was 12.6 per cent down. For the year to date, tonnage has fallen by 14.1 per cent compared to a capacity drop of 13.9 per cent, Cathay said.

The passenger picture was less encouraging as Cathay and Dragonair July figures showed another significant year-on-year fall. In July, Cathay and Dragonair carried 2,080,326 passengers - down 9.9 per cent year on year - while capacity for the month, measured in available seat kilometres (ASKs), fell by 7.5 per cent.

"The month's load factor saw a drop of 0.6 percentage points to 83.5 per cent. For the year to date, the number of passengers carried has fallen by 5.1 per cent compared to a capacity decline of 2.9 per cent," said the statement.

Said Cathay revenue chief Tom Owen: "Load factors remained flat over last year, despite significantly reduced capacity, highlighting the continued impact of the global economic downturn on demand. Bookings in the premium cabins remained especially weak which, combined with ongoing aggressive economy class competition and adverse currency movements, continued to stymie any material yield recovery."
 

Source: Transportweekly