Despite sluggish freight traffic in the Asia-Pacific, Singapore Airlines Cargo recorded 2 percent, year-over-year, growth in the first half of the fiscal year. This figure deviates greatly from Cathay Pacific and wholly owned subsidiary Dragonair’s October statistics, which demonstrated a 17.5 percent, year-over-year, descent in freight volumes.
This loss is even more pronounced than Cathay Pacific and Dragonair’s September statistics, which showed freight traffic plummeting 10.1 percent, year-over-year. Capacity and load factor also continued to decline in October, falling 4.7 percent and 8.9 percent, year-over-year, respectively.
James Woodrow, Cathay’s general manager of cargo sales, blames the carrier’s dismal numbers on continued market softness in Hong Kong and China. He’s also skeptical that the situation will improve during the typically lucrative holiday season. “It looks unlikely that we will see the usual year-end peak,” he said in a statement.
To compensate for sluggish freight traffic in the aforementioned regions, Cathay Pacific Cargo is eyeing new markets, Woodrow said. “The recently launched freighter services to Bengaluru, Chongqing and Chengdu have been well received, and on November 15, we [launched] a twice-weekly service to Zaragoza — our first time to fly to Spain,” he said in a statement.
Some are worried that increasing capacity to Europe may be a risky move, however. The Association of Asia Pacific Airlines Director General Andrew Herdman, for one, said that weak export volumes out of the eurozone and U.S. are squeezing carriers’ profitability.
Still, he anticipates brighter days ahead for Asia-Pacific carriers. It’s a good thing, indeed, he said, as Asian-Pacific cargo carriers represent two-fifths of the global airfreight market. “Asian airlines continue to take an optimistic view on future growth prospects, which is reflected in ambitious fleet expansion plans, as well as the establishment of new carriers of varying business models,” Herdman said in a statement.
Singapore Airlines Cargo officials likely share in this optimism. The carrier, which reported a 1.9-percent capacity surge in the first half of fiscal 2011-2012, also saw a slight increase in cargo load factor, with volumes improving 0.1 percent, year-over-year.