Talk is usually better than conflict. The mediation of the Labour Department has proved useful in bringing the two sides in the Cathay Pacific dispute together, producing the weekend agreement to hold further negotiations. Government intervention in this case was clearly called for and has had the desired effect.
It is, however, for the company and the pilots to move forward now. They have to do so very quickly with the company's deadline set for Friday. After Saturday's agreement to meet again, the climate was hardly improved when the Aircrew Officers' Association general secretary, John Findlay, told a forum yesterday that Cathay staff were referring to the company as 'the black heart of Asia.' The pilots insist that the dispute is not about cost saving, but about 'contract abuse and the future of the pilots' profession'. There may be room for manoeuvre on the contract issue, but cost saving is at the very heart of what the airline is seeking to achieve.
A survey we publish today shows that Cathay charges more on popular routes than almost every other airline. The company says the higher charges are justified because it offers 'a premium product, including quality services and frequent schedules'. The airline is also reckoned to benefit from its status as Hong Kong's home carrier.
But world airlines are engaged in some very sharp cost competition, and Cathay is right to be after any savings it can reasonably achieve. The bursting of the East Asian boom makes that all the more pressing.
Cathay may once have been a small airline which needed to pay over the odds to attract pilots to base themselves here, but those days have gone forever. To return to prosperity and to maintain its position internationally, the airline has to reduce its costs, and the pilots cannot escape being caught up in that process. The danger is that if both sides remain intransigent, Hong Kong will end up with much less of an airline.