- Cathay Pacific‘s bailout package was unavoidable in order to stave off more unpalatable alternatives
- Another important step will be a thorough business review and likely streamlining
- Cathay’s passenger demand was affected by protests, then took a larger hit from COVID-19
- The government will monitor its new stake via observers, but vows hands-off approach
- Strategic overhaul could mean major changes for Cathay’s fleet plan and order book
COVID-19 meant a second major challenge in quick succession
Cathay already faced problems before COVID-19 arrived. The carrier’s demand was weakened due to the protest movement that began in Hong Kong last year, and it was still in a fragile condition when the pandemic delivered an even larger blow.
The chart below shows the steep falloff in the group’s capacity this year, a curve that has become depressingly familiar in the airline industry this year.
Passenger traffic began to lag from about Aug-2019 as the protests dampened demand.