Cathay Pacific’s move to delay delivery of all the aircraft types it has on order does not augur well for aircraft-makers Airbus and Boeing.
The Oneworld carrier until recently was one of the world’s most profitable carriers but the sharp downturn in passenger traffic and its fuel hedging losses have pushed it well and truly into the red so now the carrier is having to take some drastic action.
Cathay had already been parking some aircraft but today it announced it may no longer renew the leases on some other aircraft and that it has initiated talks with Airbus and Boeing to delay delivery of A330, 777-300ER, 747-8 freighter and 747-400ER freighter aircraft on order.
This list represents all the aircraft types Cathay has on order and creates a huge headache for Airbus and Boeing.
The news comes just two days after China Southern announced it too has initiated talks with Airbus and Boeing to delay the delivery of Airbus A380s, Boeing 787s and Boeing 777 freighters.
In the first quarter of this year, Airbus and Boeing only had a few net orders. I’m afraid that if the present situation continues Airbus and Boeing may face the prospect of having a quarter in which there are more aircraft order cancellations than new orders.
But it is important to note that in the case of Cathay nd China Southern, the two have so far said publicly that a delay in aircraft delays, rather an outright order cancellation, is on the cards.
The two carriers are fully aware that to cancel an aircraft order can be a costly exercise and that it is easier to push for a delay in deliveries.