Hong Kong’s Aviation Industry Encountering Ongoing Turbulence

Hong Kong Airlines operates an all-Airbus fleet comprising of A320s, A330s, and A350s. The airline will soon be taking delivery of more than 20 A350s to carry out its ambitious long-haul network expansion. (Photo: AirlineGeeks

[ News ]January 20, 2020 2:02 pm ET

By Pete Ainsley

Hong Kong’s aviation industry has paid the price for the recent social unrest in the region. Hong Kong Airport recorded 71.5 million passengers last year, a 4.2 percent decrease compared to the prior year. Meanwhile, total cargo declined 6.1 percent year-over-year.

The passenger volume of the airport is facing its first drop in years. Vivian Cheung, Director of Airport Operation admitted the airport “went through a challenging year” and thanked the staff’s dedication in “difficult circumstances.”

The vibrant airport has experienced an unusual year, which saw it needing to implement an access control system since August in the wake of the protest at the airport. Passengers without a boarding pass were not allowed to enter the terminal. This measure is still effective and expected not to end in the near future.

According to the airport’s announcement, the passengers from Mainland China and South East Asia have dropped the most in December. However, transit passengers and the number of Hongkongers outbound travel were recorded at a 14 and nine percent increase respectively.

In the meantime, Hong Kong-based Cathay Pacific Group announced that inbound passengers dropped by 46 percent in December. As a result of the incidents in the last few months, customers from China, Japan and Taiwan recorded a huge loss. Also, the number of outbound passengers decreased by four percent, which was far below the group’s expectation for Christmas.

However, the number of transit passengers increased by 15 percent compared to the same time last year, the group heavily relied on this lower-yield traffic. Despite 2019 being a challenging year, load factors remained above 82 percent but dropped 1.8 percent compared to the previous year.

According to the airline’s figure, the Chinese market has dropped nearly 24 percent in December. However, the other markets such as North America, southwest Pacific and the Middle East have recorded a slight increase.

Even the future remains uncertain but the airline is resolute in 2020. Cathay Pacific is expecting the first A321neo single-aisle this year. Also, the group has 65 new aircraft on order that it will receive by 2024.

In a new decade, Hong Kong aviation industry is still facing a tough moment, with no end in sight for the social unrest and the threat of coronavirus, the situation is not expected to get back on track anytime soon.