Cathay Pacific Airways Ltd. (293), Asia’s biggest international carrier, said premium cabin sales fell short of its expectations in December, as the region’s slowing economic growth and job cuts by banks damp demand.
“The overall performance in the premium cabins was weaker than expected,” James Tong, a general manager at the airline, said in a stock exchange filing today. “Passenger demand held up in the economy cabin.”
The airline this month introduced a promotional offer in Hong Kong, where it’s based, for business and premium economy class passengers. Cathay seeks to boost sales as worldwide job cuts planned by banks including Morgan Stanley and Citigroup Inc. (C) damp travel demand.
Cathay and unit Dragonair carried 2.52 million passengers last month, 2.5 percent more from a year earlier, helped by the year-end travel rush. Load factor, or the percentage of seats filled by paying customers, improved to 80.7 percent after it cut frequencies on some North American and European routes and introduced smaller planes, Tong said.
The carrier didn’t provide a breakdown for economy and premium passengers.
Cathay fell 0.7 percent to close at HK$14.92 in Hong Kong trading. The stock rose 6.8 percent last year, lagging behind the 23 percent advance of the benchmark Hang Seng Index. The carrier released the statement during the midday trading break.
Cargo tonnage increased 3.4 percent in December from a year earlier, gaining for the fourth straight month, Cathay said.
The airline and Dragonair are reducing hot meals on some short-haul routes to save costs, the South China Morning Post reported today, without disclosing how it got the information. Dragonair has replaced hot meals with sandwiches for flights to Taiwan and Manila, the paper said. Cathay is already serving sandwiches on Taiwan flights.
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