Cathay Pacific Airways Ltd.’s budget carrier HK Express is holding back “a small percentage” of tickets from sale as it deals with the prospect of new plane delivery delays, Chief Executive Officer Jeanette Mao said.
“It’s not good for sales because it leaves a shorter lead time for the booking window,” Mao said in an interview on the sidelines of the Aviation Festival Asia conference in Singapore on Thursday. “Only when there are more assurances then we release to the system for sale.”
Hong Kong’s only low-cost carrier is trying to manage the twin effects of a Pratt & Whitney engine grounding that will impact 10 of its jets, while aircraft delivery delays plague the industry.
Nevertheless, the budget unit of Cathay has rebounded to around 140% of pre-Covid flight volumes as of February and should be at 170% by year-end. The airline’s expansion is key to helping Cathay meet its target of returning to pre-Covid levels around the end of 2024.
As part of its expansion push, HK Express has added new routes this year to Beijing Daxing and Bangkok’s Don Mueang airport. It’s current route network is 70% Northeast Asia, 5% China and 25% Southeast Asia. In the longer term, the carrier wants to be more balanced and diversified, meaning raising flights to China and Southeast Asia to one-third each, Mao said.
Load-factors look healthy for Easter and the northern hemisphere summer travel season, and fares should face “gradual” downward pressure as more airlines re-enter or boost capacity to Hong Kong, she said.
HK Express, an all-Airbus SE narrowbody airline, aims to have 40 planes in its fleet by the end of this year, up from 33 at the end of 2023, Mao said.
The carrier plans to take delivery of dozens more aircraft by the end of the decade. Extra planes ordered by Cathay will be shared with HK Express as it bolsters its dual-brand strategy operating low-cost and full-service airlines.
