Cathay Pacific has delayed its full passenger capacity recovery by three months to the first quarter of 2025 from the end of this year, as it seeks to address manpower shortages after a spate of flight cancellations over Christmas and Lunar New Year. “We have learned the lesson and will continue to adopt a prudent and measured approach in rebuilding our flights and therefore have made some slight adjustment to that timeline,” says chief executive officer Ronald Lam during a 13 March earnings briefing, adding that it is not a “very significant delay” and is “still in line with global peers”. The group will require 3,400 pilots to achieve pre-pandemic passenger flight capacity, says chief operations and service delivery officer Alex McGowan. Cathay Pacific and HK Express combined have about 2,900 pilots, he goes on to say, which means the group will have to train 500 more in the year ahead. The priority, for now, is to reduce the pilot attrition rate, which McGowan says has normalised from a high of 22% in 2022. “For the full year 2023, it normalised to pre pandemic levels at 5%. And so far this year, pilot turnover has been below 2% – that's the lowest on record,” he states. When asked about future flight cancellations, Lam is confident that it will not “see a similar situation [happening] again”. Cathay Pacific announced in early January that it would cancel an average of a dozen flights daily till the end of February, as it sought to minimise disruption over the Lunar New Year holidays. Prior to that, the carrier had cancelled dozens of flights over the Christmas holidays. Lam stresses that “our service is very stable now” and that its flight cancellation incidents are past, adding that for "the rest of January and February, including CNY and March, our operation was very reliable and stable". At the briefing, Cathay Pacific chair Patrick Healy declined to give a specific profit guidance for the year but alludes that “the trend is pretty clear”. Healy says Cathay’s strong results were driven by a “unique environment” as global imbalance between supply and demand drove up yields. However, as global capacity increases, he expects the imbalance to diminish and for yield to “normalise” throughout the year. “Where that lands exactly, what that means for us... nobody knows at this point, and we're certainly not in any position to give any specific guidance on that, but I think the trend is pretty clear already.” The group ended the year with 230 aircraft in its fleet, with more than 70 jets on order and additional rights to secure up to 52 more. In 2023, the group announced an order of 32 more Airbus A320/321neos, with rights to secure 32 more. The order is on top of its existing order of 32 A321neos. It also ordered six A350 freighters and rights to secure 20 more in the same year.
The group said in January that it was mulling options for new orders of mid-sized widebody planes. McGowan says the campaign is still in “early stages” and is looking at the order to be “three or four years between now and delivery”. He calls it “a medium-haul campaign or a regional replacement campaign”, adding that it’s looking for aircraft that can serve the region effectively but also “leg stretch operations” such as to Australia and Europe. In terms of fleet movements, fleet size will largely remain stable over the next two years, with deliveries mostly matching aircraft exits due to operating leases expiring. In 2024, the group is set to take deliveries of 11 aircraft. Cathay is set to receive four A320neo family jets, while HK Express is set to take deliveries of seven A321neos, with the first delivered in February. Operating leases on 11 aircraft are also set to expire this year, covering three Cathay-operated Boeing 777-300ERs, four HK Express A320ceos and four Air Hong Kong A300-600Fs. In 2025, another seven new aircraft are set to join the fleet – two 777-9s for Cathay’s fleet and five more A321neos for HK Express. Eight leases are set to expire that year: two A330-300s and two 777-300ERs in Cathay’s fleet, one HK Express A321ceo and three Air Hong Kong A330-600Fs. The lease expirations on Air Hong Kong’s ageing A300-600Fs will see their complete exit from the fleet over the two years, which the group is set to replace them with “six second-hand A330Fs”, enabling its fleet to remain mostly stable at 15 at least through to 2025.

Deliveries of new aircraft by Boeing in 2024 are set to be "way behind what they expected originally forecast and expected", United Airlines chief executive Scott Kirby observed during the JP Morgan Industrials Conference on 12 March. Kirby puts a positive spin on the delays triggered by the Alaska Airlines 737 Max 9 door-plug blowout event on 5 January. Boeing needs "to go slow to go fast", he says, adding: "I am glad that that's the case, as much as I would like those deliveries." United is in the process of converting some of its Boeing orders from the yet-to-be-certificated Max 10 to Max 9s. United is Boeing's top Max 10 customer, with 235 of the variant on order, followed by Ryanair with 150 and Delta Air Lines with 100. Chicago-based United has a total of 348 Max aircraft on order. In addition to the Max 10s, its orderbook spans 38 Max 8s, 34 Max 9s and 41 Max jets of an unspecified variant. "We will wind up having more Max 9s [this year]. For us, from a scheduling perspective, it's impossible to say when the Max 10 is going to get certified. And we've asked Boeing to stop building Max 10s, which they've done for us, and build Max 9s. If and when the Max 10 gets certified, we'll convert them back to Max 10s. But the Max 10's out for us until it's certified." Kirby indicates that United remains in talks with Airbus over a deal for A321s. "We've been pretty public [about being] in the market for A321s," he says. "If we get a deal [in which] the economics work, we'll do something, and if we don't, then we won't."

A US district court judge's rationale for blocking JetBlue Airways from acquiring Spirit Airlines bodes well for Alaska Airlines' proposed acquisition of Hawaiian Airlines, in the view of Alaska chief executive Ben Minicucci. In his 16 January ruling, Judge William Young of the Massachusetts District Court permanently blocked the JetBlue-Spirit merger, stating: "Spirit is a small airline. But there are those who love it. To those dedicated customers of Spirit, this one's for you." Young ruled in favour of the US Department of Justice, which had argued that New York-based JetBlue's acquisition of Spirit would reduce ultra-low-cost fare options – in particular, those offered by Spirit – and incentives for airlines to compete, including on 40 routes operated by both carriers. "I think it's a positive for us," Minicucci said on 12 March during the JP Morgan Industrials Conference, in reference to the court decision on JetBlue-Spirit. "The judge was clear in saying that he's blocking the deal because of the elimination of an ultra-low-cost carrier that has benefit to consumers in the country. And our deal [with Hawaiian] is nowhere near that. Our deal is completely different. We're actually the low-cost, low-fare airline acquiring Hawaiian." In December 2023, Hawaiian Airlines parent Hawaiian Holdings and Alaska parent Alaska Air Group agreed to combine under a $1.9 billion deal set to close within 12-18 months. Minicucci says Alaska and Hawaiian have "very few overlap markets", putting the number at 12. A merger would "give Hawaiian residents three times more choice than they have today to connect to the continental US, [and] more choice internationally with our Oneworld partnership", he asserts. He adds that the mayors of the four largest Hawaiian islands support the deal. Additionally, Minicucci expects that US regulators will view favourably Alaska's reputation for serving remote communities and the resulting brand loyalty. The DOJ will, he posits, likewise keep in mind Alaska's commitment to retaining the target's brand, which was not the case with JetBlue and Spirit. "We'll have a dual-brand exterior with one platform in the background, which is something we're working through. [There are] going to be a lot of questions how we're going to pull that off, but I think it's a unique way of us positioning this acquisition versus the Spirit and JetBlue [deal]. So I hope that the merits of the case will shine through." The carriers' fleets have very little overlap, although on an operational level this would seem not to be a positive. Alaska's in-service fleet is entirely comprised of Boeing 737s, while Hawaiian operates a mixed fleet. Alaska is flying 165 737NGs and 65 Max jets, and has 80 Max aircraft on order, Cirium fleets data shows. It is storing 14 A320s, remnants of its 2016 acquisition of Virgin America. Minicucci notes that Alaska has 47 Max deliveries scheduled over the next two years", but adds. "We're not going to get 47 deliveries over the next two years – it's obvious. We have 23 deliveries in 2024 – 10 airplanes are built, awaiting delivery. Of course, Boeing is under FAA scrutiny, [and there's] the DOJ investigation. It's going to take a while for us to get those 10 airplanes." Of the Virgin America acquisition, he remarks that the "rat is through the snake", elaborating thus: "We had 72 Airbus [aircraft] that we [received] from the Virgin acquisition that we went single fleet. That's 72 extremely bad leases that we [had] to get out of, and then purchase replacement Max airplanes. So that was massive capital that went through in the last couple of years." Hawaiian's fleet comprises 25 A330s, 23 717s, 18 A321s and one 787, The airline has another 11 787s on order. Minicucci says that in the case of the Hawaiian merger, there is "not that sense of urgency" to pursue a single-fleet plan as there had been with the Virgin America acquisition. "Virgin did not own any airplanes, or maybe just a handful with very onerous leases," he says. "Hawaiian owns two-thirds of their fleet, 40% of which are unencumbered. So: totally, totally different. That gives us a lot more flexibility in what to do. Is there opportunity for optimisation and rationalisation? Yes." He adds: "The reason we went single fleet [with Virgin] is, we had two aircraft types performing the same mission in the lower 48 [states]… With Hawaiian, they have different airplanes performing different missions – inter-island, they have some domestic long-haul international, and now they just got their first 787. "So we have to look at that and just really understand which airplanes play a certain role for us. And then we're going to rationalise. But we've got time. The good thing is they own most of their fleet, and it gives us more opportunity than we did with Virgin."