Cathay Pacific Posts Record Loss Of $783 Million In 2021 As Hong Kong's Draconian Border And Quarantine Rules Takes Toll On Carrier

by India Infrahub - Jan 24, 2022 06:15 PM +05:30 IST
Cathay Pacific Posts Record Loss Of $783 Million In 2021 As Hong Kong's Draconian Border And Quarantine  Rules Takes Toll On CarrierCathay Pacific aircraft (Bathara Sakti/Flickr)
Snapshot
  • Cathay Pacific, Hong Kong’s beleaguered carrier, posted a loss of HK$6.1 billion ($783 million), hit by the draconian zero-Covid policies pursued by the city-state administration, in line with mainland Chinese approach.

    The airline said for this month it is operating about 2% of its pre-pandemic passenger capacity and around 20% of its pre-pandemic cargo capacity. In December 2021, the airline flew around 97% fewer passengers than before the pandemic.

Cathay Pacific, Hong Kong’s beleaguered carrier, posted a loss of HK$6.1 billion ($783 million), hit by twin blow of demand contraction and draconian zero-Covid policies pursued by the city-state administration. in line with mainland Chinese approach.

The estimated loss in 2021 however represented an improvement over the HK $21.6 billion ($2.7 billion) loss it suffered in 2020. The improvement was driven by strong cargo demand and cost cutting measures.

The airline also forecast a bleak business outlook for 2022, as the Chinese-controlled city reimposed significant travel restrictions to contain the spread of the Omicron coronavirus strain. It forecast that it will lose anywhere between HK$1billion to HK$1.5 billion a month due to stricter aircrew quarantine regulations which will force it to further reduce cargo and passenger capacity.

The airline said for this month it is operating about 2% of its pre-pandemic passenger capacity and around 20% of its pre-pandemic cargo capacity. In December 2021, the airline flew around 97% fewer passengers than before the pandemic.

"Until conditions improve, we are doing everything in our power to maximize capacity, and estimate that mitigation measures to increase crew resources will enable us to operate approximately an additional 5 percent more cargo flight capacity than we are currently operating," Tang said.

Cathay Pacific is 45 per cent owned by British-Hongkong conglomerate Swire Pacific and mainland carrier Air China is its second-largest shareholder with a 30 per cent stake.

The airliner has been under intense pressure from the Hong Kong local authorities who blamed two Cathay staff for first outbreak of the Omicron variant. The local government announced even stricter quarantine rules following the incident.

Cathay pilots have highlighted how the restrictions have affected their mental health and personal lives.

BBC quoted one one pilot, who has spent almost 150 days in isolation this year alone, as saying that he is in a "perpetual state of quarantine,"

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