Cathay Pacific to save HK$2.2 billion by changing investment in new planes
Hong Kong’s flagship airline will delay delivery of five Airbus A350-1000 planes and opt for smaller models instead of six more
Cathay Pacific Airways has said it will save HK$2.2 billion (US$288 million) by delaying the delivery of long-haul aircraft and switching to smaller long-range planes as the company confirmed a HK$31.7 billion order for 32 short-haul aircraft.
Hong Kong’s flagship airline said it would tinker with its multibillion dollar investment in new planes, in an announcement to the stock exchange on Wednesday. The airline is cutting costs and restructuring in a bid to return to profit after producing the worst half-year results in almost 20 years last month.
The carrier said it will downsize six of its 26 Airbus A350-1000 planes for half a dozen smaller A350-900 planes, raising it from 22 to 28 aircraft. It will also delay the delivery of five more A350-1000 aircraft by one year to 2021.
The savings is based on the cost of at least six A350-1000, ordered between 2010 and 2012, worth an estimated HK$15.3 billion and its smaller sibling costing roughly HK$12.2 billion for the same quantity.
It follows the trend of other airlines either delaying deliveries or reducing orders amid fears of an oversupply of air tickets while fares are low.