Cathay Pacific 2013 Annual Report Download - page 18

Cathay Pacific Airways Limited Interim Report 201316
Review of Operations
• In the first six months of 2013, Dragonair
introduced services to four new destinations–
Da Nang, Wenzhou, Yangon and Zhengzhou–
and increased frequencies on the Chiang Mai,
Kaohsiung, Kota Kinabalu and Wuhan routes.
The service to Da Nang increased from three to
four flights a week from July.
• Cathay Pacific’s new premium economy class,
introduced in 2012, is growing in popularity
with passengers and has helped to improve
economy class yield. By 30th June 2013,
premium economy class was available on 68 of
our long-haul aircraft. By the end of the year it
will be available on 85 aircraft.
• Demand for leisure travel from Hong Kong
was robust in the first half of 2013. Our weekly
“fanfares” promotion (which started in October
2012) is popular with price sensitive customers.
Demand for business travel from Hong Kong
was stronger than in the first half of 2012.
• There was an increase in traffic derived from the
Pearl River Delta region, but competition for this
traffic from other airlines is strong.
• Demand for travel to and from Mainland China
was reasonably robust up to April. However,
demand for travel to Mainland China (and
particularly Eastern China) reduced sharply
following the outbreak of H7N9 avian flu.
Demand for travel from Mainland China was
less affected. We cancelled flights on an ad hoc
basis in April and May, with a view to aligning
capacity with demand.
• Yield on Taiwan routes was under considerable
pressure in the first half of 2013 as a result of
intense competition.
• Demand for travel to Korea, which had been
strong for much of 2012, weakened in the first
half of 2013. The weakness of the yen increased
the popularity of Japan as a leisure destination
at the expense of Korea. Demand for travel from
Korea to and through Hong Kong remained
reasonably firm.
• Demand for travel to Japan benefited from the
weakness of the yen in the first half of 2013,
with more flights being put on during holiday
periods. Demand for travel from Japan was
adversely affected by the country’s economic
situation.
• We will introduce a new four-time-weekly
service to Male in the Maldives in October and
a new daily service to Newark in the U.S.A. in
March 2014, subject to government approval.
• Dragonair’s new Da Nang and Chiang Mai
routes have performed well. Demand on most
other routes in Southeast Asia was in line
with expectations. A new three-times-weekly
seasonal service to Siem Reap in Cambodia will
be introduced in October, subject to government
approval.
• Demand for travel to and from the Philippines
was robust.
• Demand for travel to and from Mumbai and
Delhi was robust. Passengers have responded
well to the introduction of the new business
class seats and the new premium economy
class on these routes. The Kolkata route has
performed strongly since its introduction in
2012. The performance of the Hyderabad route
is gradually improving.