Cathay Pacific 2017 first half results - HK$2.05b loss
 

(Edit 16/8 16:31 results announced http://www.hkexnews.hk/listedco/list...0170816199.pdf )

http://sc.mp/G5LYCr

"The pressure Cathay is facing also necessitates its move to add an extra row of seats in economy class." --> "The pressure Cathay is facing also necessitates its move to add an extra seat to each row of seats in economy class."?

Cathay Needs to Win Over Customers at the Back of the Plane https://www.bloomberg.com/news/artic...chinese-fliers

SCMP should have asked people on this forum to write an article instead - they're much better informed than your average journalist.

Also reported in Bloomberg

Cathay Needs to Win Over Customers at the Back of the Plane https://www.bloomberg.com/news/artic...chinese-fliers

Danny Lee (author of the article, and of many CX articles) is actually a regular FT member and is quite knowledgable.

CX, the first hybrid LCC/Premium airline!

Sorry to divert from the subject matter for a sec, in the Bloomberg article, there is a great photo of a few people taking photos of a plane landing in HKG. Anyone know where this is?

Not the first

Hmm so the CA merger news keeps coming up, any comments on that?

i think that's the terminal 2 roof. Accessible from the cinema or wherever the old aviation museum used to be by stairs.

If Swire wants to sell Cathay, I am sure CA will buy it.

Therefore, the key is whether Swire want to hold CX or not.

The third largest shareoholder - Kingboard wants to buy more CX shares from Swire but Swire rejected. It seems that Swire is still committed to hold CX.

So the MPO changes that pretty much ran mid-range Econ flyers out of town, and now Cathay is trying to dump discounted fares to "lure them back"? Brilliant plan.

This article amazes me on so many levels.

Firstly, I'm amazed that not all the analysts have a sell recommendation on CX. I can't fathom anyone believes that the plan they have unveiled with the current management will result in a turnaround. The new CEO is the same old, same old - a company man bereft of any new thinking. What they needed was an outsider to shake things up.

Secondly, if anyone in the industry believes that people at the back of the plane will pay more for quality they must be delusional. This has been disproven in Europe where the legacy carriers have been decimated in the short haul market by LCCs and facing increasing competition in the long-haul space from Norwegian etc.

In any case, CX is not a "premium" airline in China. Anyone who goes to the CX China website will regularly see economy (and to a lesser extent business) class fares to/from and connecting via HK that are bargain basement. Getting these fliers to pay up for quality when they have been enjoying these fares is an even harder challenge. In reality, it is only the poor suckers in HK that still pay premium prices for CX.

As for further belt-tightening with a sub-par regional business class product (but with high prices), poorly maintained cabins, one of the worst in-flight catering of any major carrier in business class, increasingly crowded lounges etc, CX should be doing everything to hang onto the premium traffic that they have and not give people a further excuse to look elsewhere. I'm a CX Diamond and what do I get for my loyalty? Nothing that any OWE wouldn't and declining standards to boot.

CX should be focused on winning back high-spending fliers (some of whom have left because of the reasons above, others because of the changes to the frequent flier program) and going LCC in the back of the plane. Instead the strategy seems to have a soft product that matches BA in business class and provide a premium service in the back. Nonsensical, at least to me.

How exactly does it work being premium in the front end and LCC in the back? If you think CX's service at the front end is inferior to mainland carriers then I'm wondering which mainland carriers you fly (certainly not any that I have experienced). And there are plenty (like me) who can and do pay for quality at both the front and the back of the plane...

@Arbeysix, regarding your questions

1. Hainan Airlines domestically in China have a better product in business class on their wide body planes and better food and drink than CX/KA apart from those CX planes with the long haul configuration which they fly on regional routes. CX/KA business class meals ex-China have got to a point where they are marginally better than the Chinese carriers. As for hard product, just fly any major Chinese carrier between SH and Beijing on a wide body (e.g. Air China) and you will find lie-flat seats in business class. I have done this flight a number of times in Air China's 747-8. Compare that to the 2-3-2 regional configuration on CX and stuck in the middle on a flight to Beijing with a 3 hour tarmac delay is hardly premium. For the HK-PEK route which I fly 2-3 times a month, I choose CX/KA because Air China does not compete. They do this by charging as much and putting all narrow body 737s which are ancient. It's a no brainer to fly CX/KA in that situation. If Air China flew their wide body flat beds I would take it in a heartbeat. For me, a flat bed is worth more than a mediocre business class meal on CX or KA.

2. Being premium at the front means - improving your catering, not cutting back to a cheaper champagne, maintaining your cabins better so that the trim is not peeling or things are not falling off etc. LCC in the back means packing in more seats (which CX is now planning to do abreast) but could also do by reducing seat pitch, charging for services (e.g. Seat selection etc.). You may be willing to pay for quality at both the back and the front but you are definitely not in the majority, if you were CX would not be having those issues and the legacy carriers in Europe would be thriving

Who the heck needs flatbed between shanghai and peking