Cathay delays plane delivery
Updated: 2011-12-20 07:20
(HK Edition)
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Hong Kong Dragon Airlines and Cathay Pacific Airways planes park at the Hong Kong airport. Cathay will slow next year's cargo capacity expansion to 10 percent from the planned 17 percent. Nelson Ching / Bloomberg |
Cathay Pacific Airways Ltd has delayed the delivery of two 747-8F freighters from Boeing Co to 2013 from next year, as it slows next year's cargo capacity expansion to 10 percent from the 17 percent it planned earlier amid waning demand.
Cathay made the announcement in an e-mailed statement on Monday.
The company ordered a total of 10 Boeing 747-8F planes and received four this year, with the rest originally scheduled for 2012.
"We will continue to take delivery of four next year and two in 2013," said Cathay spokeswoman Carolyn Leung.
"We're very aware of the pressure of rising costs in our business," Slosar said in the carrier's in-house magazine that was e-mailed to reporters on Monday. "We're already taking action to make sure we can run a much tighter ship in 2012."
"This is good for the company," said Kelvin Lau, a Hong Kong-based analyst at Daiwa Securities Group. "Cargo demand next year will be weak, so Cathay should not deploy too much capacity."
"Cathay's cargo throughput has been falling since the beginning of the year and news on the delivery delay should help as cargo growth is unlikely to rise 17-18 percent next year," said Daiwa Securities analyst Kelvin Lau.
Cargo tonnage at Cathay fell for eight straight months this year as slowing global economic growth dampened orders for Asian-made goods from US and European retailers. Demand will continue to be "soft" in the first few months of next year, Slosar said on Dec 5.
2011 had been a much bumpier ride after the highs of 2010, Slosar said in the airline's monthly staff magazine CXWorld.
The usual year-end rush for cargo had not arrived but passenger bookings for the Christmas were pretty good, he said.
"As for what happens after that, well, a lot will depend on the world economy," he said. "If, as is usually the case, cargo is a lead indictor and our passenger business starts to decline then of course we need to be prepared."
Last week, Cathay reported a 13.8 percent fall in cargo throughput for November and said the passenger outlook was uncertain for 2012.
The International Air Transport Association (IATA) cut its forecast for industry profits earlier this month and warned that the industry could suffer losses if Europe's debt problems triggered another banking crisis.
Bloomberg - Reuters
(HK Edition 12/20/2011 page2)