Aviation regulator’s measures could threaten Cathay Pacific’s access to the lucrative mainland Chinese market, and the airline is moving fast to limit the damage
- One-fifth of all Cathay’s flights serve mainland and, combined with Hong Kong, China constitutes half of airline’s total revenue
- With China set to overtake the United States as world’s biggest aviation market, Cathay has little incentive to reduce its activities there
China’s latest move against Cathay Pacific could send the city’s flagship airline into a tailspin and trigger possibly the worst crisis of its 72-year history, as a review of its finances revealed the airline’s increasing reliance on the mainland market.
The potential threat was recognised by Rupert Hogg, the airline’s CEO, in his letter to staff on Saturday, who said China is “key to our business”, as he responded to the intense scrutiny its mainland China operations were facing from the country’s civil aviation regulator.
Beijing has taken aim at Cathay Pacific’s golden egg – its access to the mainland market and reliance on the country’s airspace – in response to the airline’s staff openly supporting the demonstrations.
CAAC barred Cathay aircrew who had joined or supported illegal protests from operating flights to mainland China, or flying through Chinese airspace, among other measures.
The regulator also said, from Sunday, flights that did not have CAAC-approved crew lists would not be allowed to use Chinese airspace.