Cathay Pacific Posts Record-Breaking Loss for 2020

by Michael Cheng

Hong Kong carrier Cathay Pacific announced its financial results on Wednesday. The company reported losses totalling to HK$21.6 billion for 2020 following the downturn for the global aviation industry due to the coronavirus pandemic.

Cathay Pacific Chairman Patrick Healy stated that 2021 is still uncertain and noted that the past 12 months had been “the most challenging” period in the 70 years since the company was founded.

Cathay Pacific has parked almost half of its fleet.

Cathay Pacific has parked almost half of its fleet.

The airline has parked almost half of its fleet. “Market conditions remain challenging and dynamic,” said Healy to the local newspaper, with uncertainty prevailing for airlines due to the pandemic over the coming months.

Vaccination hopes

The airline’s staff has been highly supportive in participating in the vaccination scheme, with vaccination sign-up rates firm and encouraging. Healy explained the carrier is looking forward to proactively assist in conversations with the Hong Kong Government to loosen the crew quarantine restrictions. Cathay Pacific Chief Executive Officer Augustus Tang has also encouraged all employees to get vaccinated. He mentioned such action would be beneficial in bringing back the business.

Airport

The carrier said there was no immediate need to cut more jobs. Last year, the company cut 5,900 jobs, lowered pay for flight staff and stopped its regional Cathay Dragon operations. Since tightened quarantine requirements for flight crew, the embattled carrier has been losing between HK$1.3 -1.9 billion per month, mostly in manpower costs.

Cathay’s air freight operations have become the silver lining for the company as prices soared due to the skyrocketing demand for air freight and fewer operational aircraft, resulting in the carrier considering a potential expansion of its cargo network.

The airline endured a 98% drop in its passenger operations, especially after cutting domestic flights, and turned to the government and shareholders in June 2020 for a HK$39 billion bailout to avoid going bust.

During the pandemic, travel has been discouraged through tightened travel restrictions and quarantine measures to stave off the importing of the virus into Hong Kong.

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