Cathay Pacific Reports Positive 2023 Results Amid Potential Pilot Strike Concerns

Cathay Pacific recently reported a remarkable H1 performance, its strongest in over a decade. However, a looming challenge is emerging as the airline’s pilots contemplate striking against the management.

The Hong Kong Aircrew Officers Association (HKAOA) revealed its initial moves toward possible industrial action, with legal guidance being sought. Representing Cathay Pacific’s pilots, the union raised concerns about the airline’s operations at 75% or even full pre-pandemic capacity. Additionally, the potential impact of the airline’s choices on Hong Kong’s Global Aviation hub status and the shortage of pilots, cabin crew, and aviation experts were questioned.

The HKAOA emphasized Cathay Pacific’s need for around 650 captains, while only roughly 100 pilots are currently qualified for this role. Moreover, active pilots have faced pay cuts of approximately 25%, which could rise if flight schedules decrease. During the pandemic, pay cuts for inactive pilots reached up to 60%, with allowances slashed by 50% or more for certain families. This stands in contrast to the global trend of increasing pilot pay rates.

Cathay Pacific, which initially projected a return to profitability in H1 2023, instead achieved a net profit of HKD4.2 billion ($537.1 million) on revenues of HKD43.5 billion ($5.5 billion). Patrick Healy, Chairman of Cathay Pacific, attributed HKD1.9 billion ($243 million) of the profit to a one-time non-cash gain from diluting its shares in Air China.

Healy expressed optimism about Cathay Pacific’s progress in rebuilding connectivity at Hong Kong’s aviation hub following border reopenings. The company plans to buy back 50% of its preference shares for HKD9.75 billion ($1.2 billion) by late 2023 and the remaining shares by July 2024, contingent on the proposed capital reduction and business conditions.

Recovering its pre-pandemic capacity remains a primary focus for Cathay Pacific, aiming for 70% by year-end and full network restoration by late 2024. Healy extended gratitude to customers and employees for their support and dedication throughout the challenging years.

In an additional announcement, Cathay Pacific revealed its intention to exercise options for 32 Airbus A320neo/A321neo aircraft, solidifying the purchase by September 30, 2023.

The Cathay Pacific group encompasses Cathay Pacific, HK Express, and Air Hong Kong, each playing a significant role in the aviation landscape.