Analysis Reports

The Cathay Pacific Group has revealed more details of its plans for network growth this year, as it switches its focus from rebuilding to expansion, despite fleet challenges.

Cathay Pacific has announced a slew of new destinations, and more are still under wraps.

The new routes will help the airline leverage strengthening demand in key markets, such as mainland China, with major capacity gains also expected via frequency increases this northern summer.

Depending what measurements are used, the group has either fully recovered to pre-pandemic capacity and flight levels, or is very close to that point.

Either way, it is primed to move beyond these levels this year, although prepandemic comparisons are no longer a focus for the airline.

Lavinia Lau, Cathay Pacific's chief customer and commercial officer, talked to the Aviation Week Network in Hong Kong recently about the airline's network and fleet strategies.

However, it remains unclear to what extent the gathering macroeconomic and geopolitical clouds will affect the airline's plans.

Seats are currently on sale for Global Airlines' launch flight, a charter service from Glasgow to New York JFK on 15-May-2025, returning four days later. This will be followed by a Manchester-New York flight on 21-May-2025, also returning four days later.

The UK start-up, founded in 2021 by travel entrepreneur James Asquith, has a unique business model. It will deploy only Airbus A380s on long haul routes, with a focus on customer service and premium pricing. Although it owns its aircraft, the first A380 is operated by Hi Fly Malta.

Global Airlines initially hoped to commence operations in 2024 but supply chain challenges intervened. Having overcome those issues, it is now preparing to fly just as official US statistics show a decline in visitors by air from Western Europe for Mar-2025.

Airlines worldwide continue to grapple with the trade whiplash initiated by the US, and some operators are preparing for various types of scenarios as a potential recession in the country looms large.

But for two US airlines - Delta Air Lines and United Airlines - performance in long haul international markets is holding up, driven by US point of sale compensating for a drop-off of inbound demand.

That's a bright spot for the moment; but if overall consumer confidence continues to deteriorate, what will that mean for US point of sale over the course of 2H2025 and beyond?

Although uncertainty continues to prevail, United Airlines remains confident of powerful prospects in international markets over the long term.

It may have surprised some that Bogotá's El Dorado International Airport overtook São Paulo Guarulhos and Mexico City Juarez International airports in 2024 to be Latin America's busiest but the Colombian airport had been narrowing the gap on them for several years now.

In common with many airports of its size and scope in Latin America El Dorado has been concessioned for quite a few years, to a multinational consortium within which the shareholders have waxed and waned and out of which the Colombian company Odinsa is the main partner and strategist.

El Dorado has grown rapidly but that growth has overtaken the ability of the infrastructure to handle it.

Odinsa is now tasked with overseeing a huge expansion of the airport including a doubling of the terminal size and the extension of one of the two runways to what would be one of the longest in the world.

At the same time a decision has to be taken on the location and actual construction of a second, reliever airport for the city-region, dubbed El Dorado II, and which is now in at least the seventh year of deliberation and it is one that must take into account the ever evolving nature of the air transport business, for service providers and customers alike.

While the major capacity benefits from the new three-runway system at Hong Kong International Airport (HKIA) will be seen in the long term, airlines can still expect to see some immediate operational and efficiency gains from the extra runway.

The airport commissioned the new system (known as the 3RS) in Nov-2024, allowing it to operate three runways for the first time.

This is projected to eventually boost hourly movements by nearly 50%, although the increase will be gradual as slots are added in stages over multiple years.

The first capacity gains will be seen in the peak periods. In addition to more flights at these times, the 3RS is also expected to help significantly during adverse weather and disruption recovery.

Airline executives from Hong Kong-based carriers have welcomed the prospect of capacity increases, as well as the likelihood of improved performance during and after severe weather.

The process of developing the 3RS, and its importance to airline expansion plans, was described in this CAPA - Centre for Aviation analysis.

Pegasus Airlines celebrated its 35th anniversary of launching operations on 15-Apr-2025.

Over the past three and a half decades, the Turkish airline has developed from a charter operator with two Boeing 737-400s to an ultra-low cost carrier with 119 narrowbodies, focusing mainly on the Airbus A320 neo family.

However, its Dec-2024 order for 100 737 MAX10s, with a further 100 options, shows that it was happy to revert to Boeing for the next phase of its growth.

Now one of Europe's most profitable airline companies, Pegasus has succeeded for 35 years through a combination of pragmatism and innovation.

London Luton Airport, situated close to the centre of a declining industrial town north of London, has become the UK's fifth busiest airport and retained that accolade, built mainly on low cost and charter traffic to vacation destinations.

It was proposed as a four-runway alternative to London Heathrow Airport when the Airports Commission deliberated on that matter in the mid 2010s, but that was quickly swept under the carpet.

Subsequently, it was identified for more modest expansion and maximum passenger growth from 18 million annual passengers to 32 million.

The government has just agreed to support that application, and then almost in the same breath, announced the development of a huge US-owned theme park in the southern suburbs of Bedford - an inconspicuous county town 20 miles (32km) to the north of the airport.

Luton will be the closest commercial airport to the UK's first US-owned theme park when one is built by the Universal Music Group, to open in 2031.

Now calculations have to be redone, and the results recalibrated.

How will this amusement park, which is expected to receive 8.5 million guests in its first year - half of Luton Airport's annual passenger throughput in 2024 - influence demand there? Will the latest cap be adequate? How many visitors, from home and abroad, will use other airports? Or travel by rail or other surface methods?

And it hasn't even got planning permission yet (although the government will undoubtedly try to 'facilitate' that). Everyone knows what a pain getting planning permission can be in the UK.

New airports to serve India's two largest cities are moving closer to their goal of starting operations this year, with ambitious growth plans for future phases.

The Indian airlines have placed massive aircraft orders in recent years, boosting the country's order backlog to nearly 1,900 aircraft. India's airport infrastructure is already near capacity, so new facilities are being constructed in many cities to accommodate the fleet growth.

The most significant projects are in the biggest markets, with second airports being developed for the Delhi capital area and the Mumbai metropolitan area.

Senior executives of both facilities updated their plans during the Routes Asia conference in Perth on 26-Mar-2025, and airline executives also discussed the need for the new airports.

Airports, typically, take many years from concept to completion, except within China and Türkiye.

But the decision on the location alone of the new airport to serve Addis Ababa, the capital of Ethiopia, took seven years.

It isn't that the existing airport, Bole, is ramshackle. It could continue to be patched up and moderately expanded, perhaps to last for another 10 years.

But courtesy of the success of Ethiopian Airlines, which is widely regarded as the premier airline on the African continent, ambitions are big. And the projected Abusera Airport, which should be open in its first phase in 2029, envisages total annual throughput eventually amounting to 110mppa, making it one of the biggest airports in the world, by today's standards.

It is a project, though, that might not have been feasible without the attachment of an airport city - one that will cost more than the airport.

The African Development Bank will probably provide loans, possibly syndicated ones, but the opportunity may still remain for the private sector investment fraternity to commit finally to a major African project such as this; one that is built on solid commercial acumen, with the state airline a major player.

After the election of the US president, Donald Trump, in Nov-2024, some of the country's airlines breathed a sigh of relief, betting that a change in administration would reverse policies aviation leaders had deemed onerous.

Nearly four months into Mr Trump's presidency, US airlines arguably find themselves stuck in a mental tug of war - they still remain optimistic that Mr Trump will initiate positive changes for the industry, but are also reeling from a whiplash of trade policies that are upending their financial forecasts.

The rapid changes beg one overarching question: are the benefits from favourable policy meaningful if profitability is wiped out?