Cathay Says Market Has "Collapsed"

[Nigelinoz]

Cathay Pacific has shed further light on the impact of the financial crisis on its business,
admitting the market has "collapsed" in the past month.
The airline posted a loss of $1.6 billion last week, and chief executive Tony Tyler admitted
it was a "worrying time"."What we’ve seen more recently, and particularly in the last month, is a rapid deterioration of economy class," Tyler told Bloomberg."Yes we can fill flights, but we
are filling them at very low fares."

Full Text:
http://www.travelweekly.com.au/dirplus/images/travelweekly/TravelTodayPDF/16_03_2009.pdf

 

[JohnK]

I wouldn't say the market has "collapsed" if they are still able to fill flights with passengers.

Perhaps the pendulum has swung and now it is the turn of the travellers to get good deals instead of being forced to pay whatever airfare the airline wanted. Travellers will shop around and want to pay less for airfares and the airlines will need to factor this in their long term strategy. The world we live in may take a long time to recover from the latest financial crisis....

 

[Evan]

QF openly stated that they could fill the plane with whY and break even or do a bit better but the J/F passengers are not there and as such they are making less profit.
Thing is CX used on a lot of routes not to care about an empty plane they just held there prices and be damned ! but it used to make them lots of money, not so now in the current climate.

 

[mannej]

Having flown with CX within the last 2 months, it is clear that to keep flights full,they will substitute their equipment very last minute, or cancel flights and reaccomodate pax onto other less full flights. It does create more work for them, but we still got from A to B without much drama in the end!

 

[dajop]

What astonishes me about the likes of CX and SQ is the fare differential between their lowest economy and those fares typical of LCC's (on flights of <4 hrs). By Aussie standards it is really quite staggering.

It is very common to be able to purchase QF domestic/TransTasman for not a lot more than Jetstar & DJ and even Tiger when they're not giving seats away. Yet in Asia the multiple seems to be 3 to 4 times the fares of LCCs on similar routes, not just tens of percents. Therefore I am not surprised by the alleged collapse in the economy market, given the current climate.