New success for the A321neo. Airbus announced Monday it had signed a memorandum of agreement with the group and Cathay Pacific for the sale of 32 A321neo to its regional subsidiary Cathay Dragon (ex Dragonair), a contract from 4.06 billion (2.46 billion euros) at list prices. According to Airbus, these 32 aircraft would allow Cathay Pacific to replace and modernize the current fleet of 15 airbus A320s and 8 A321s Cathay Dragon but also to propose new destinations, increasing the frequency of its flights on certain routes the most frequented. Cathay Dragon currently flies to 56 destinations in Asia, including 28 in mainland China.
“With the A321neo, we expect a significant increase in our operational efficiency, and (we) will be able to increase the capacity of Cathay Dragon on the entire network to expand our customer base,” said Rupert Hogg, the boss of Cathay Pacific.
The battle in the Middle of the Market
The A321neo is the extended version of the single-aisle bestseller for Airbus. It is now in competition on the market of 220-250 seats (Middle of the Market) by the 737 MAX 10 of Boeing, there still a version remotorisée medium-haul of the aircraft manufacturer of Seattle, the launch of which was unveiled at the last paris air show in June.
“This choice is another strong sign of confidence in the A321neo, the airline of choice for the segment in the Middle of the Market”, said said John Leahy, the commercial director of Airbus.
Financial difficulties
This memorandum of purchase comes as Cathay Pacific has made state the last week of his heavier half-year loss since at least 20 years and said he did not expect an improvement by the end of the year as it continues to lose market share against its competitors in mainland China.
His loss on the period January-June amounted to 2.05 billion dollars of hong Kong (223 million euros) compared to a profit of $ 353 million a year earlier, which should lead the company to record, for the first time since its creation in 1946, a second consecutive year of losses.
The turnover grew by 0.4% over the first six months of the year to 45.9 billion dollars of hong Kong, but the unit revenue decreased by 5.2%.
“We don’t anticipate significant improvement in business conditions in the second half of 2017,” said the president of Cathay John Slosar.
“The business passengers in particular will continue to suffer from the strong competition from the other airlines and our results should be negatively affected by the increase in fuel prices and our hedging positions for fuel,” he added.
