While speaking to analysts about its now postponed travel bubble between Hong Kong and Singapore, Hong Kong-based Cathay Pacific said it had almost sold out a few week’s worths of tickets. A day before postponing the travel bubble between the two former British colony’s Cathay executives gave an update on the airline’s performance in a closed-door briefing with members of the investment community on Friday.
While reporting on the meeting, the South China Morning Post (SCMP) quotes Cathay’s executive director Ronald Lam Siu-por as saying:
“The demand for our Singapore travel bubble flights is overwhelming.”
“In the next few weeks, our flights are pretty much full. There is also a quota of 200 passengers per flight due to the limited capacity and high demand; our flights are pretty much sold out in the next few weeks.”
The infection rate went up
A day before the travel bubble between Hong Kong and Singapore was due to begin, the Hong Kong government changed its stance, saying it would need to be postponed for two weeks.
The delay was due to a sharp increase in local infection rates as a new wave of COVID-19 hits the region. Before setting up the travel bubble, officials agreed that if untraceable infections exceeded five in either city over seven days, the bubble would be suspended.
On Sunday night, untraceable infections in Hong Kong reached 5.29, triggering an automatic two-week suspension of safe travel between Hong Kong and Singapore. When looking at what occurred during Hong Kong’s third wave of the coronavirus, the SCMP says that when untraceable cases breached five on July 13, it took 50 days to get the rate back below five. If this is true, it could mean a much longer postponement of the travel bubble than two weeks.
The travel bubble could be worth $11.9
Bloomberg Intelligence estimates that a travel bubble between Hong Kong and Singapore would be worth HK$93 million ($11.9 million)in revenue to Cathay Pacific and lower the amount of money it was losing by 6%. Of all the Asian carriers, Cathay Pacific has been hit the hardest by the COVID-19 global pandemic as it had no domestic routes to rely on for revenue. If that wasn’t bad enough, Cathay lost 90% of its international capacity to border closures. At one point, Cathay Pacific saw its passenger volume collapse by 99%, with the airline only transporting 1,500 passengers a day.
On the plus side for the ailing airline is that it is the fifth-largest cargo airline globally and has partnered with the Airport Authority of Hong Kong to help get COVID-19 vaccines delivered once they are available. Cathay Pacific is one of a handful of carriers who happen to be globally certified for handling sensitive, temperature-controlled pharmaceutical products like vaccines.
It seems like no matter what Cathay Pacific tries to do; everything goes against them. Hopefully, the suspension of the Hong Kong-Singapore travel bubble will only last two weeks, but if what happened in July is anything to go by, it could be extended further.
What do you think about the Hong-Kong-Singapore travel bubble? Will it only last two weeks or be extended further? Please tell us what you think in the comments.