Cathay Pacific cutting capacity as Hong Kong unrest takes a toll
The fallout from the political unrest in Hong Kong continues to spread.
Reuters Nov. 29 is reporting Cathay Pacific Airways is cutting capacity as travel to and from Hong Kong International Airport (HKG) deteriorates. Reuters cited internal company documents that show the airline will now cut flights in 2020 by 1.4% instead of a planned increase of 3.1% in capacity. Earlier this month, the Hong Kong-based company said it was cutting its second half profit forecast for the second time in less than a month.
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Political turmoil has been flaring in Hong Kong since late spring of 2019, as protesters have taken to the streets over what they consider the government's failure to protect citizens' civil liberties. Hong Kong is a part of China, but is supposed to remain politically independent until the late 2040s.
Last week, elections were held for district councils, and pro-democracy candidates took 87% of the seats. The city has been relatively quiet since then.
But thousands have been arrested during sometimes violent protests that began in June. At least two deaths have been attributed to the protests, and many have been injured.
Ongoing trade troubles between China and the United States have further strained the economy. Hong Kong officially entered a recession in October with the economy shrinking by more than 3% in the third quarter.
In a memo obtained by Reuters, Cathay Pacific Chief Executive Augustus Tang said, "Given the immediate commercial challenges and the fact that our position has deteriorated in recent weeks, we must take swift action to adjust our budget operating plan for 2020 downwards again. Put another way, rather than growing our airlines in 2020, for the first time in a long time, our airlines will reduce in size.
The airline said advance bookings are weaker than hoped especially to key markets like Hong Kong and mainland China.
A representative from Cathay Pacific refused a request from Reuters for comment.
Meantime, Hong Kong Airlines, owned by Chinese conglomerate HNA Group, also said Nov. 29 it was further cutting capacity. It also said it was delaying salaries for almost half its employees. The company says business has been "severely affected," by the turmoil in Hong Kong, and announced in a press release it was cutting flights to Vancouver, Ho Chi Minh City and Tianjin, China, by February 2020. The airline had previously announced it is cutting its flights to Los Angeles and San Francisco.
Several airlines also have cut capacity to Hong Kong, including South African Airways, Malaysia's AirAsia Group, and United Airlines. Hong Kong's Civil Aviation Department said in a statement last night its "use-it-or-lose-it" rule had been temporarily suspended for the winter season as demand has fallen. Normally, if an airline isn't using its takeoff and landing slots more than 80% of its allowed time, those slots would be lost.
Airport Authority Hong Kong reported a 13% drop in passengers in October, and a drop of more than 6% in the number of inbound and outbound flights.
But it's not all bad news on Hong Kong. Most travel experts say it's still safe to visit.
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| 4X | Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 4X | Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year. |
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There’s a lot to love about the Amex Gold. It’s a fan favorite thanks to its fantastic bonus-earning rates at restaurants worldwide and at U.S. supermarkets. If you’re hitting the skies soon, you’ll also earn bonus Membership Rewards points on travel. Paired with up to $120 in Uber Cash annually (for U.S. Uber rides or Uber Eats orders, card must be added to Uber app and you can redeem with any Amex card), up to $120 in annual dining statement credits to be used with eligible partners, an up to $84 Dunkin’ credit each year at U.S. Dunkin Donuts and an up to $100 Resy credit annually, there’s no reason that foodies shouldn’t add the Amex Gold to their wallet. These benefits alone are worth more than $400, which offsets the $325 annual fee on the Amex Gold card. Enrollment is required for select benefits.Pros
- 4 points per dollar spent on dining at restaurants worldwide and U.S. supermarkets (on the first $50,000 in purchases per calendar year; then 1 point per dollar spent thereafter and $25,000 in purchases per calendar year; then 1 point per dollar spent thereafter, respectively)
- 3 points per dollar spent on flights booked directly with the airline or with amextravel.com
- Packed with credits foodies will enjoy
- Solid welcome bonus
Cons
- Not as useful for those living outside the U.S.
- Some may have trouble using Uber and other dining credits
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $6,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
- Earn 2X Membership Rewards® points per dollar spent on prepaid hotels and other eligible purchases booked on AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- $120 Uber Cash on Gold: Add your Gold Card to your Uber account and get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an American Express Card for your transaction. That’s up to $120 Uber Cash annually. Plus, after using your Uber Cash, use your Card to earn 4X Membership Rewards® points for Uber Eats purchases made with restaurants or U.S. supermarkets. Point caps and terms apply.
- $84 Dunkin' Credit: With the $84 Dunkin' Credit, you can earn up to $7 in monthly statement credits after you enroll and pay with the American Express® Gold Card at U.S. Dunkin' locations. Enrollment is required to receive this benefit.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year after you pay with the American Express® Gold Card to dine at U.S. Resy restaurants or make other eligible Resy purchases. That's up to $50 in statement credits semi-annually. Enrollment required.
- $120 Dining Credit: Satisfy your cravings, sweet or savory, with the $120 Dining Credit. Earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, and Five Guys. Enrollment required.
- Explore over 1,000 upscale hotels worldwide with The Hotel Collection and receive a $100 credit towards eligible charges* with every booking of two nights or more through AmexTravel.com. *Eligible charges vary by property.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.