Imagine having to drive to work and 50% of the streets between your home and work were closed. It would definitely make for a unique commute and leave you asking “how am I supposed to work?”
Well, according to SCMP, Hong-Kong based Cathay Pacific and Cathay Dragon have 120 aircraft idling on the ground at any given time; which accounts for more than half of their fleet.
In addition, the group has cut more than three-quarters of their weekly flights in March. Around 1,470 weekly flights were originally scheduled for this month, but it is now been trimmed down by more than 1,120 flights.
Back in 2003, during the SARS crisis, Cathay trimmed 45% of their scheduled flights and had around 30% of their fleet idling on the ground. Comparing these two epidemics, it appears that Convid-19 is bringing a greater impact to the airline.
In the past couple of weeks, Cathay Pacific has asked 27,000 employees to take 3 weeks unpaid leave and have also temporarily closed three of their premium lounges at Hong Kong International Airport.
Explaining the situation, an analyst from Bocom International, Luya You, said that “an outbreak is the kind of macro impact that is really hard for an airline to plan around… during an outbreak, all of it collapses because people, no matter the price point, are no longer willing to fly”.
Singapore Airlines, one of Cathay’s closest rival, has temporarily suspended over 3,000 flights between March and the end of May. In addition, the management team is taking a 15% pay cut and the airline has offered a voluntary no-pay leave option to employees.
FINAL STAMP
It’s no secret that coronavirus is taking a toll on economies and financial markets around the world.
When will it all end? Obviously, I’m not a health professional so I have no solid answers (or even guesses) on the matter. However, I do know that airlines are receiving the brunt of the pain.
Grounding 50% of your flights and canceling 75% of your daily scheduled flights will undoubtedly have a serious financial impact on the airline and country overall.
What do you make of this situation? Have you flown since this outbreak started? If not, how could the airlines convince you to purchase a ticket?
1TattedPassport 