Cathay Pacific Passenger Numbers Rebound Slightly in July

Cathay Pacific 's passenger carriage has rebounded in July, but still only carried 1.3% of those carried in July 2019. Throughout July, Cathay enjoyed increased patronage on flights to North America and Europe, in a sign that international travel is somewhat rebounding.

Cathay Group experienced substantial capacity reductions in July, attributing the cuts to "significantly reduced demand" and Hong Kong's re-imposed mandatory quarantine for returning travellers.

Cathay Group CCO Ronald Lam told the media that July's figures were largely boosted by resumption of important international services and transit in Hong Kong.

"Passenger volume showed signs of slight improvement in the beginning of July, fuelled by a boost in the number of transit passengers via Hong Kong... However, demand tapered down towards the end of the month as new waves of COVID-19 cases arose in numerous countries," Ronald Lam, Chief Customer and Commercial Officer, Cathay Pacific Group

In light of COVID-19 spikes throughout late-July, passenger volume increased at a lower rate than capacity for July, and load factor further dipped to 23.4%.

Regardless, Cathay Pacific and its regional subsidiary, Cathay Dragon, reached 7% of normal capacity, up from about 4% in June.

July Traffic Figures (Cathay Pacific/Cathay Dragon Combined)

Outlook

Hong Kong's so-called third wave of COVID-19 has prompted Cathay to predict 8% of normal capacity by 31st August - an increase of just 1%. Passenger capacity is not expected to increase any further throughout early September. Furthermore, Mr Lam referred to the IATA's revised outlook of sector recovery, which has been pushed back by a year to 2024.

Cathay's latest issues have come in the form of a "looming global recession" and an unstable future for the Asia-Pacific. Such geopolitical tensions will undoubtedly disrupt or degrade Cathay's operations in North America and the Pacific.

Meanwhile, Cathay has benefited from the resumption of international transit via Hong Kong for passengers from mainland China. Mr Lam said that such services will "help enhance [Cathay's] passenger volume" and "offer essential connections" to different parts of the world.

Hong Kong's tourism market has taken an astronomical hit from COVID-19 - a reduction of 85.3% year-on-year between January and April. Travel advisories from major tourism markets, such as Australia and the USA, warn of the dangers associated with the new National Security Law. Moving forward, such issues are likely to cause more travel disruption.