Cathay Pacific delays Cargo Terminal by 2 years

[Pieter C. 5]

Cathay Pacific Delays Cargo Terminal By 2 Years

 

January 15, 2009

Cathay Pacific Airways said on Thursday it will defer completion of its new Hong Kong cargo terminal by up to 24 months to mid-2013, as the global economic slowdown hits cargo traffic.

 

Cathay warned on Tuesday its cargo and mail traffic dropped nearly a quarter in December on weak demand from China, while passenger numbers fell slightly.

 

The carrier said the first quarter of 2009 will be weak, and revised its cargo capacity to Europe and North America downwards.

 

"The deferral is aimed at better matching supply and demand in the air freight business given the current market outlook. It is also important for the company to maintain a strong balance sheet until the market strengthens," Cathay Pacific said in a statement.

 

It added that it remains fully committed to building and operating the third cargo terminal.

 

The HK Airport Authority said it had agreed to the delay for the facility which was originally scheduled for opening in the second half of 2011.

 

Cathay Pacific Services, a wholly owned subsidiary of Hong Kong's dominant airline, holds a non-exclusive 20-year franchise to operate the terminal, awarded to it in March by the Airport Authority.

 

Cathay's shares dropped 2.4 percent to close at HKD$8.38 on Thursday.

 

(Reuters)

 

[KK Lee 5]

 

Likewise, MH cargo volume dropped substantially. December shipment from KUL to China was down by over 50%!