Cathay boss: 'Aviation continues to be a challenging industry'
- Written by December 8, 2015
Cathay Pacific's boss has outlined challenges facing the aviation industry as the airline moved to award a pay rise to staff.
The airline announced last week the majority of Hong Kong-based ground staff and cabin crew will receive a 4 per cent pay rise for 2016, with senior staff to receive 3.7 to 3.8 per cent.
But in making the announcement, Cathay Pacific Chief Executive Ivan Chu outlined the tough conditions currently facing the aviation industry.
Cathay said the latest salary increase took into account factors ranging from changes in the cost of living to the company’s business performance and longer-term prospects. The views of various staff representative groups were also considered.
Mr Chu said there were many uncertainties ahead in 2016 that required the company to take a cautious approach.
“Aviation continues to be a challenging industry," he said.
"We are facing slower economic growth, a reduction of inbound travellers from Mainland China, and sluggish cargo traffic.
“We saw an improvement in our business in the first half of the year, driven by high passenger numbers and the lower price of fuel.
"These trends continued into the second half of the year, which is traditionally stronger, but our overall performance has been affected by pressure on passenger yield and weaker-than-expected premium traffic on long-haul routes.
"On the cargo side of the business, we have seen stagnating demand since the second quarter of the year together with declining yield as a result of overcapacity in the market."
But Mr Chu said the team had risen to the challenge of the operating environment.
“We have been able to achieve a number of positive things in 2015, including the expansion of our networks, the continued modernisation of our fleet, and a range of product and brand-related enhancements," he said.
"We are happy to reward our team’s effort with this discretionary bonus and salary increment.”
Mr Chu said that Cathay Pacific will continue to make strategic long-term investments to maintain the quality of its products and services.
And, as the airline gets ready to celebrate its 70th anniversary as Hong Kong’s home carrier next year, it will remain deeply committed to the long-term development of Hong Kong as an international aviation hub.