Cathay Pacific Signs Big Plane Order as it Scrambles to Regain Dominance

Skift Take

Cathay Pacific was hit harder than most during the pandemic, and remains a relative laggard on the international stage. Bosses see 2024 as the year that its rebuilding plan really starts to gathers pace.

Gordon Smith

Hong Kong’s largest airline is continuing its post-pandemic shopping spree. On Wednesday, Cathay Pacific announced a deal for 30 Airbus A330neo planes. The contract, valued at around $11 billion, also includes rights for a further 30 of the European-built widebody aircraft.

Although the A330neo is often used for long-haul flying, Cathay says the new arrivals will primarily be deployed on its short and medium-haul Asian network. Airlines in the region frequently operate larger widebody jets on busy intercity routes. The new jets are due for delivery between 2028 and 2031. 

With the latest deal, the wider Cathay Group has more than 100 new aircraft in its delivery pipeline, with options for an additional 80.

While no plane maker likes to lose business, Airbus was always the front-runner for this latest order. The deal, which followed “thorough evaluation by the airline,” sees Cathay double down on its commitment to the A330. The Hong Kong carrier has flown the type for almost three decades and operates more than 30 in its current fleet.

Despite being the favorite to win the contract, Christian Scherer, CEO of Airbus Commercial Aircraft described the deal as “a major endorsement” of the new-generation plane.

It isn’t all bad news for Boeing. Cathay Pacific has firm orders with Airbus’ main rival for 21 of its next-generation 777-9. The airline is hopeful that deliveries will begin next year, however, the plane has yet to be formally certified by regulators.

Air China has a 30% shareholding in Cathay, however the Hong Kong airline is not following mimicking its more diversified fleet strategy.

In April, the Chinese flag carrier signed a deal with local plane maker COMAC for 100 C919 jets. All three of mainland China’s largest airlines now have major orders pending for the new aircraft.

Cathay’s Epic Turnaround

Bosses at the airline previously suggested that no major carrier was hit as hard as Cathay Pacific during the pandemic. Hong Kong’s international borders were closed, it lacked a domestic market, and crew were subject to stringent quarantine laws.

Cathay is still struggling to regain lost ground after a long period of near-dormancy in its passenger operations. Both internally and publicly, Cathay describes these efforts as “its rebuilding journey.” 

In the second quarter, the airline was back to flying about 80% of its pre-Covid passenger flights. It doesn’t expect to fully recover until early next year.  Newark, Seattle, Washington Dulles, London Gatwick, and Dublin are a few examples of long-haul routes Cathay flew in 2019 but hasn’t yet restarted in 2024.

A Return to Former Glory?

As well as new planes, the company is upgrading its existing fleet to help win back market share. Pre-pandemic, Cathay was renowned for offering one of the best onboard experiences in the market. Challenges in recent years have seen investment in new products falter. 

This is due to change later this year when the much-anticipated Aria Suite business class cabin launches on Cathay’s Boeing 777-300ER. Premium economy and economy are also due to receive an overhaul. 

Meanwhile, in 2025, a “world-leading first class experience” is promised onboard its new Boeing 777-9s, and in 2026, an all-new business class cabin will be introduced on its existing A330s.

On-the-ground enhancements include new flagship lounges in Hong Kong, Beijing, and New York JFK. All three are due to be unveiled before the end of 2027. 

The Airbus order came as Cathay announced its Q2 results. Its net profit in the first six months of 2024 dropped 15% compared to the same time last year. The firm said the reduction was “principally attributable to the normalization of ticket prices.” 

Cathay carried a total of 10.7 million passengers in the first half of 2024, which was up 36% year-on-year.