Hong Kong's Cathay defers Airbus plane deliveries as demand falls

Asian airline chiefs cancel Hong Kong meeting due to 'unpredictability of the situation', as violent protests continue.

    Hong Kong's biggest airline, Cathay Pacific, has been caught in the turbulence caused by months of violent anti-government protests [File: Thomas Peter/Reuters]
    Hong Kong's biggest airline, Cathay Pacific, has been caught in the turbulence caused by months of violent anti-government protests [File: Thomas Peter/Reuters]

    Hong Kong's Cathay Pacific Airways Ltd has said it would defer the delivery of four Airbus SE narrowbody planes in 2020 as it cuts capacity to deal with falling demand due to anti-government protests in its home city.

    In addition to delaying the arrival of three A321neos at its regional arm Cathay Dragon and one A320neo at budget carrier HK Express, it said on Thursday it would retire one Boeing Co 777-300ER and one Cathay Dragon A320 earlier than expected.

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    The airline said on Wednesday the short-term outlook remained "challenging and uncertain" as it lowered its profit projections for the second time in less than a month.

    Anti-government protests paralysed parts of Hong Kong for a fourth day on Thursday, forcing school closures and blocking highways and other transport links amid a marked escalation of violence.

    Cathay said the unrest was expected to lead to a small post-acquisition loss for HK Express, which it bought this year from Chinese conglomerate HNA Group for 4.93 billion Hong Kong dollars ($629.7m).

    The airline said last week it planned to allocate half its order for 32 A321neo aircraft to HK Express as it looks for growth opportunities in the budget market, but made no mention of any changes to the delivery schedule.

    An Airbus spokesman said delivery schedules change from time to time by mutual agreement with customers, declining to provide further details of the timing.

    Meanwhile, an annual gathering of the heads of Asia's airlines, planned to take place in Hong Kong next week, has been cancelled.

    The Association of Asia Pacific Airlines said in a statement its decision to scrap the event scheduled for November 21-22 "reflects the unpredictability of the situation in Hong Kong". The meeting was organised by the association in conjunction with Cathay Pacific.

    The protests, which began in earnest in June in opposition to a proposed criminal extradition bill, have driven away tourists and badly hurt the city's hotels, shops and restaurants. The bill has been officially withdrawn, but it became a lightning rod for broader discontentment over growing inequality and unaffordable housing.

    SOURCE: News agencies