Cathay Pacific suffers July air cargo slowdown

A July increase in airfreight volumes at Cathay Pacific and Dragonair was not enough to offset volume increases and stop another decline in load factors.
The Hong Kong airline recorded a 1.4% year-on-year increase in airfreight volumes in July to 877,066 cargo and mail revenue tonne km (RTK).

Meanwhile, capacity increased in 6.2% during the month to 1.4m available cargo/mail tonne km, resulting in its load factor slipping to 61.8% from 64.7% in July last year.
Cathay Pacific general manager cargo sales & marketing Mark Sutch said general industry overcapacity also put pressure on margins during the month.

“After a flat second quarter, demand for airfreight shipments remained below expectations throughout July,” he said.
“The growth in tonnage lagged the growth in capacity by a sizeable margin, which dragged down the month’s load factor.
“Yield remained under pressure due to overcapacity in a number of markets. Among the positive stories of the month, demand into and out of India continued to be ahead of expectations and we also saw an upsurge in project shipments out of Western China, and Chongqing in particular."

The figures are a reflection of the fact that 2015 has been a year of two halves for airlines with a strong presence on the transpacific trade.
While in the first quarter, the airlines received a boost from a strike-related slowdown at US west coast seaports, the last few months have been a reflection of weakening exports from China.
For Cathay Pacific the strength of the first quarter means its average load factor for the year so far stands at 63.8% compared with 63.2% for the first seven months of 2014.
Also, volumes for the first seven months are 9% ahead of a year earlier at 6m RTK.