The number of passengers flying to Hong Kong with Cathay Pacific Airways plunged 38 per cent in August as the often violent anti-government protests scared away visitors during one of the busiest months for travel.
And the weakening business environment would not ease in September, the city’s largest airline group said on Wednesday.
Demand for business class travel, which supports far more of Cathay Pacific’s revenue compared with economy, “experienced a more significant drop”, the airline said, signalling fewer people willing to come to Hong Kong for corporate reasons.
“August was an incredibly challenging month, both for Cathay Pacific and for Hong Kong,” Ronald Lam Siu-por, chief customer and commercial officer at the Cathay Pacific Group, said.
“Overall tourist arrivals were nearly half of what they usually are in what is normally a strong summer holiday month, and this has significantly affected the performance of our airlines.”
The group, which includes flagship carrier Cathay Pacific and regional airlines Cathay Dragon and HK Express, said it would make some unspecified cuts to routes in the short-term.
“We do not anticipate September being any less difficult,” Lam said. “Given the current decline in bookings for the remainder of the year, we will make some short-term measures such as capacity realignment.”
The airline also said it would delay non-critical spending and freeze hiring ground staff.
In the biggest decline for a decade, Cathay Pacific carried 11 per cent, or 370,000, fewer passengers in August year on year, with a total of 2.9 million customers flying worldwide. Its planes were 79.9 per cent full, the monthly traffic report revealed.
The figures did not include HK Express, which was acquired by the group in July.
Airlines have repeatedly warned fewer people want to travel to Hong Kong as a consequence of the citywide protests, which have now entered their 14th week.
Cathay said inbound traffic from mainland China had been “severely hit”.
China’s civil aviation regulator issued a safety warning in early August, barring staff who supported the anti-government protests from flying into the mainland or over its airspace.
Some large Chinese businesses also boycotted the Hong Kong carrier. Demand from mainland China dropped 28.1 per cent year on year.
Demand in North East Asia, which includes Japan, South Korea and Taiwan, fell 11.8 per cent, while that of South East Asia slumped 8 per cent.
Flights to and from Australia and New Zealand appeared to be the only positive area, with a 3.2 increase in demand.
Across a range of metrics, it was a bad August for Cathay.
Passenger numbers fell to levels not seen since August 2014, when it then fell to 2.84 million customers. In percentage terms, it was the single biggest plummet since June 2009, during the global financial crisis.
The airline’s load factor dipped below 80 per cent for the first time since May 2013 and, hit by the ongoing US-China trade war, it carried 14 per cent less cargo year on year – the 10th consecutive month of decline.
However, the airline was “slightly more positive” on its September outlook for cargo, with companies expected to restock supplies going into a season of high global demand in trade.
Hometown rival Hong Kong Airlines said it carried 13 per cent fewer passengers in August, while foreign carriers Qantas and Emirates also reported 10 per cent fewer travellers to the city.
Cathay Pacific has been rocked by resignations and reshuffles at the top under pressure from Beijing to rein in staff taking part in illegal protests. The airline has warned that those who “support or participate in illegal protests” will be disciplined or sacked.