Mumbai: Hong Kong-based Cathay Pacific Airways Ltd has decided to expand its services in India, following an air services agreement between the Hong Kong and Indian governments in December last year. By June, Cathay Pacific will fly an additional 20 flights a week between the two countries. It has already increased its flights to Delhi from four a week to 14, and added six more flights to Mumbai for a total of 10 per week. The airline will also dig into southern India, launching a four-times-a-week service to Chennai on 2 June, while its sister airline Dragonair will start a daily service to Bangalore, in late May.
Cathay Pacific chief executive Antony Tyler looks excited about the India plan. In a five-star hotel at a city suburb last Thursday, he celebrated the airline’s expansion in India, hosting more than 300 travel agents, cargo agents, and airline and airport partners along with Cathay Pacific’s team in India. Through the celebrations, he had a special friend with him: Naresh Goyal, chairman, Jet Airways India Ltd. After seeing Goyal off at 11.30 pm, Tyler sat down for an interview with Mint, sparing some time between his dinner and bed. Edited excerpts:
All airlines are eyeing India now. How are you planning for India?
Cathay Pacific is one airline with a long-standing relationship with India. We have been here for the past 26 years, starting with just eight flights a week. India is a very important market for us.
Antony Tyler, chief executive, Cathay Pacific Airways. The airline is expanding its presence in India
As a matter of policy, we will not disclose the country-wise share of our airline operations. India is not a big contributor to our total turnover yet. But certainly, if not this year, bynext year, India will feature on our Top-10 list of contributors.
Why did you take 26 years to start expanding in the country?
Well, the reason for not expanding (earlier) was because of traffic rights. We were using all our traffic rights between India and Hong Kong. Cathay also understands that India-Hong Kong was an underserved market in terms of flights. But last December, Indian and Hong Kong governments reached an agreement to expand air services between the two places.
Is it competition or cooperation with Jet Airways?
Certainly as airlines serving in the same market, we are supposed to compete. At the same time we will also co-operate. We are looking at having special pro-rata agreement,or SPAs, with Jet Airways, which could be taken to further levels later.
Under our cooperation agreement, Jet Airways will feed into the four Indian cities we operate in as it (Jet) connects about 50 cities in India. Likewise, we will feed to Jet’s flights from Hong Kong from various other locationsin our country. Cathay and Indian carriers will help to realize the full potential of trade and tourism between Hong Kong and India.
Hong Kong cannot be positioned as a great destination from India. So what’s the strategy behind this huge expansion?
Hong Kong is a superb hub. We are targeting passengers not only travelling till Hong Kong, but beyond as well. We are offering excellent connections to places such as mainland China, Japan, Korea, Taiwan, Australia and other parts of Asia from Hong Kong. We have passengers for North America.
You have more competition now from China and India. What’s your strategy to beat the competition?
You are right! We now have 70 airlines to compete with from Hong Kong. Competition is there from India too.
Competition is good. The services provided by our charming and gracious crew will make all the difference for us, apart from offerings such as flat beds in business class. To add to that, we will have competitive and promotional fares especially for Indian passengers.
You have 22 freighters operating out of India. How big is cargo operation for you and what are your expansion plans?
As a whole, cargo contributes to 30% of our business. We will continue to look at cargo opportunities in India. We are the No. 1 foreign carrier in terms of cargo carrying capacity and tonnage in India. We will do all we can.
Recently, travel agents slapped a legal showcause notice on you for clubbing surcharges and taxes with basic fares. What next?
Most airlines do it the same way. We are examining ways to deal with the subject.
Would it be your sister airline Dragonair or Cathay that will expand more in India?
We will fly either Dragonair or Cathay, whichever is profitable. We are just now charting out our expansion plans with Dragonair to India.