CAI to increase services to Asia

PUBLISHED : Saturday, 13 February, 1993, 12:00am
UPDATED : Saturday, 13 February, 1993, 12:00am

CANADIAN Airlines International (CAI) is to increase its services to Hongkong and other cities in Asia.

''We are also planning to return service to China and we're studying other destinations in a long-term approach,'' said the manager of sales and service for Orient routes, Tosh Naganuma.

CAI had record losses of nearly C$250 million (about HK$1.5 billion) last year.

While dropping at least two of its domestic destinations, CAI will increase its capacity to Hongkong, Taipei, Tokyo and Nagoya.

The carrier will replace a mixture of daily 247-seat DC-10 and 747 services with 392-seat 747-400 flights between Hongkong and Vancouver; increase the frequency of flights by two to six weekly between Taipei and Vancouver; double the number of flights tosix a week between Taipei and Toronto; and add two flights a week between Nagoya and Vancouver.

CAI still holds licences and agreements with the Chinese Government to operate flights from Vancouver to Beijing and Shanghai, services it suspended in 1991.

Mr Naganuma said CAI had recently dropped two money-losing Canadian destinations and would focus on its most profitable routes.

Also anxious for the increased service to Asian cities is American Airlines Inc's parent company, AMR Corp, now awaiting approval from the Canadian Government to buy into CAI.

American Airlines operates only two US-Asia routes, between Tokyo and Dallas and between Tokyo and San Jose, California, and the company is eager to tap into the Asian market.

Valued at about HK$1.5 billion, the proposed cash infusion from AMR Corp almost matches CAI's losses for 1992.

If the Canadian Government transport committee approved the deal, American would effectively take 33 per cent of CAI's stock, 25 per cent of voting control and a large interest in the Asian destinations.

However, AMR will also be stepping in to assume a third of CAI's projected losses for 1993.

which, according to company officials, could well exceed the record loss incurred last year.