July 2023 was a remarkable month for Cathay Pacific and HK Express, as the Cathay Group reached a significant milestone. For the first time since the pandemic, the group carried over two million passengers in a single month. Cathay Pacific alone transported 1,744,374 passengers, marking a whopping 693.8% increase compared to July 2022.
The numbers are impressive across the board. Revenue passenger kilometers (RPKs) surged by 421.6% year on year, and the passenger load factor jumped by 16 percentage points to 89.3%. Available seat kilometers (ASKs) also saw a 328.2% increase year on year. In the first seven months of 2023, the number of passengers carried soared by 1,622%, with an 818.9% increase in capacity and a 1,149% increase in RPKs compared to the same period in 2022.
Travel Trends and Cargo Growth
Chief Customer and Commercial Officer Lavinia Lau expressed delight at the strong demand, especially during the traditional summer peak for passenger travel. She noted an 11% capacity increase compared to June, primarily on services to North America, Europe, Japan, and Southeast Asia. Long-haul flights to and from Hong Kong were particularly popular among visiting friends and relatives (VFR) travelers.
The start of school holidays in mid-July also led to a substantial increase in demand for popular short-haul destinations around Asia. This resulted in a near 90% load factor for July.
On the cargo side, July saw an increase of 14.9% compared to the previous year, with cargo revenue tonne kilometers (RFTKs) growing by 24.6% year on year. Though the cargo load factor decreased by 11.2 percentage points to 59.8%, available cargo tonne kilometers (AFTKs) increased by 47.9% year on year. The first seven months of 2023 witnessed a 22.4% increase in tonnage, a 102.5% increase in capacity, and a 71.1% increase in RFTKs compared to the same period in 2022.
Looking Ahead with Optimism
Cathay Pacific is optimistic about the future. The strong travel demand seen in July is expected to continue through the rest of the summer peak in August. The group, comprising Cathay Pacific and HK Express, is now close to 60% of pre-pandemic passenger flight capacity levels. They are on track to achieve their target of 70% covering 80 destinations by the end of this year and are confident of reaching 100% by the end of 2024.
Exciting developments are also on the horizon for customer experience. The airline is reopening its lounge in Taipei and offering a sneak peek of the all-new Business class experience, Aria Suite, coming to the long-haul Boeing 777-300ER fleet in the second quarter of next year.
While cargo volumes are expected to remain flat for the rest of the summer, demand is anticipated to pick up from the end of the third quarter. Overall, the cargo business is expected to perform solidly throughout the second half of 2023.
As a financial update, the Group paid the latest dividend of HK$292.5 million due on the preference shares on August 14, 2023, following the payment of the HK$1.5 billion deferred dividend in June.
Cathay Pacific’s July 2023 traffic figures are a bright spot in the airline’s recovery journey. With robust growth in both passenger and cargo sectors, the future looks promising.
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