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Cathay Pacific Agreed To Acquire HK Express



Cathay Pacific Livery

According to the “South China Morning Post” report, sources said that Cathay Pacific has agreed to acquire Hong Kong Express Airways.

Cathay Pacific Airways (00293-HK) reportedly agreed to acquire the low-cost Hong Kong Express (HK Express). The South China Morning Post quoted sources as saying that the fastest announcement will be made today (26th), but no details of the financial terms of the agreement have been provided.

At the beginning of this month, Cathay Pacific confirmed that it was actively negotiating an acquisition involving Hong Kong Express. At the mid-month performance meeting, Cathay President John Robert Slosar was asked if he would propose a full purchase, only indicating that there was no supplement at this stage. However, he pointed out that the aviation industry is a constantly-changing industry and we should “never say never” for the development of low-cost carriers.

According to sources, Cathay Pacific will issue a formal announcement on Tuesday at the earliest. However, he did not explain the details of the agreement, including financial terms.

The deal means that Cathay Pacific will officially set foot in the low-cost market without having to adjust its high-end service strategy for its main brand.

Cathay Pacific faces competitive pressures from low-cost airlines, and the low-cost travel market will allow Cathay to attract fare-sensitive travelers.

According to sources, one of Cathay Pacific’s main tasks is to adjust the management team of HK Express, and most of the executives from HNA or HNA Group will leave.

If the deal is finalised, Cathay Pacific will control three of the four largest passenger airlines in Hong Kong.

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Route Network

KLM Prepares To Operate At Half Capacity This Winter



KLM Fleet At Amsterdam Airport

The planned upscaling of KLM’s European network in September has been put on hold owing to adjusted travel warnings, prompting Code Orange (essential travel only) designations for the UK, Spain, parts of France and other countries. Compared to August KLM’s route network in September and October remains stable.

Parked KLM Fleet, Image Rights: Marco Spuyman
Parked KLM Fleet, Image copyight: Marco Spuyman

The European Commission has announced the extension of the ‘slot waiver’ to the entire winter timetable. This has enabled KLM to respond more adequately to the rapidly changing market conditions as a result of COVID-19, even during the winter season. 

In addition to the financial impact, operating less well-filled flights would also be undesirable from a sustainability perspective.

“We are making all possible savings within the group and in the companies, which is essential to be able to get through the months to come.”

Air France-KLM CEO Benjamin Smith told French daily L’Opinion

He believes that it may take until 2024 for Air France-KLM Group’s business to return to the level of 2019.

Due to the Covid-19 pandemic, KLM’s winter schedule will be a lot more restricted than it was in the same period last year. The timetable for the European network in November is currently around 55% of capacity in 2019.

KLM was gradually and responsibly expanding its European and intercontinental network, after the corona crisis had prompted severe restrictions on destinations and frequencies. 

KLM’s primary aim is to offer customers the widest range of destinations, after which we will consider increasing the number of frequencies or expanding capacity by deploying larger aircraft.

In August, KLM served almost 100% of its European network in terms of destinations, with capacity at approximately 60% compared to pre-corona levels.

  • Effective 25 October 2020, KLM will begin operating daily flights to the Polish city of Poznan.

Intercontinentally, KLM served 80% of its destinations at 60% capacity. At present, a third of these intercontinental flights are carrying cargo only. This means seat capacity is way down. KLM will carry passengers on these flights again as soon as local travel regulations allow.

  • From the beginning of September, KLM will resume a twice-weekly service to the Chinese city of Hangzhou, flying via Seoul Incheon in South Korea. 
  • KLM will also operate a twice-weekly service to Cairo.
  • Riyadh will also be added to the KLM network as a new destination (original start was September 26th, but is now scheduled for December 7th). 
  • On 29 October, KLM will also start a circle flight to add Edmonton back to the Canadian network. The flight will depart to Calgary, then call at Edmonton and fly back to Amsterdam.

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