22 April 2014

[220414.EN.AIR] Cathay-Air NZ Revenue-Sharing HK-Auckland Route Is Working Well

THE joint venture between Cathay Pacific and Air New Zealand that involves revenue sharing is working well, according to the Hong Kong-based airline's chief operating officer, although he can't foresee a rapid recovery in the market. 

The carriers last year introduced the revenue-sharing deal on the Auckland-Hong Kong route, reported the New Zealand Herald.

"The logic of that joint venture between points in New Zealand and Hong Kong is that it is a long, thin route, where a combination of the carriers working together means that you can get connectivity at both ends for two flights rather than one," said Mr Hogg.

"We are trying to build that route and build that connectivity quicker than either of us can do individually," he said. "So far it has worked well."

"We are a long haul and ultra-long haul carrier and we believe the market was ripe for it and that it has given us a big competitive differentiation."

As for the airline's outlook for this year, Mr Hogg said the company was experiencing seven per cent growth in available seat kilometres (ASKs) relative to a flat performance in 2013.

"We are seeing a lot of growth across the Pacific, partly because the American economy, we think, is very flexible and obviously very large," he said. And there were "huge volumes of traffic" from China, Hong Kong and India.

However, he was not overly optimistic about market conditions as many parts of the world, especially Europe. "It's not a disaster but we don't see big signs of rapid recovery."

Source : HKSG.

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