Cathay posts 1.26bn hkg loss

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kelvedon

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Cathay have just announce its first back to back loss in its 71 years of existence, blaming intense competition from Chinese and LCC airlines. Though it appears the market expected worse, its shares rose 1% this afternoon. Makes Qantas look like a goldmine.

Cathay Pacific in first back-to-back loss
 
Makes Qantas look like a goldmine.

Let’s not forgot QF’s position 3-4 years ago. They went through (and are still executing) very significant cost cutting to return to profit. Hopefully CX can achieve the same too.
 
Cue all of us amateur observers .... :)

I do wonder of CX's refusal to play in the LCC space is meaning they're missing out on part of that pie, or taking yield hits to discount and participate in that end of the market. In this part of the world, both SQ and QF seem to be aggressively playing both sides with their dual brands, whilst CX seems to avoid it. Also I guess the 787's now travelling between various US and Chinese cities, coupled with quality improvements of both US and Chinese carriers have made it challenging for them as the incumbent premium carrier between US & China.
 
And cue back to the time when JQ was created. Many "experts" were saying that QF were making a bad strategic decision as JQ would just cannibalise the premium market. But history teaches that markets are often segmented and horses for courses is a valid business model. Don't need a racehorse for a pony club when a pony will do (or whatever your favourite analogy is)
 
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lots of equestrian wannabes buy top of line horses to go to pony club. they are kitted out with an expensive horse because their parents think an expensive horse wins the most ribbons.
 
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