Cathay Pacific Airways Ltd canceled about a fifth of its flights yesterday as a dispute with pilots entered an eighth day. The carrier said its decision to fire 49 pilots on Monday has not triggered extra disruptions.
Asia's fifth-biggest carrier is receiving no sign that the pilots union plans to escalate the dispute, said Cathay spokesman Tony Tyler. A go-slow by pilots has forced the airline to cancel as many as a third of its daily flights since contract talks broke down last week.
"We've no longer got any backlog of passengers except for the UK," said Tyler in an interview. "It's now stable."
Pilots have stepped up wage demands in airlines worldwide at a time when passenger and cargo growth is slowing. Cathay pilots rejected an earlier offer that included a 10.5 percent wage rise, and began a go-slow that disrupted flights during Cathay's busiest month.
New terms introduced yesterday for remaining pilots include a pay increase of as much as 9 percent and increased housing, maternity and education benefits. The airline hopes the new package will reduce support among pilots for industrial action, Tyler said.
"I think the pilots will make a choice. Do they want to carry on with industrial action or get back to work?" said Tyler.
"We're pretty sure a large number of them will [return to work]. The average pilot doesn't want any of this."
Officials for the union couldn't be reached for comment.
The increased pay and benefits will cost Cathay "several hundred million [Hong Kong] dollars," Tyler said, declining to give an exact figure.
Cathay's shares recently fell 0.5 percent to HK$10.10 yesterday, after falling 3.3 percent on Monday.
Cathay canceled 29 of the 143 flights originally scheduled for today and 39 flights out of 122 yesterday, the carrier said in a statement. The airline didn't say how many flights were delayed yesterday.
By noon, two departing flights had left around 15 minutes later than scheduled, while five flights arrived 15 minutes or more late, according to the Hong Kong airport's Web site.
"Cathay, to a certain extent, escalated the issue," said Mohan Singh, an analyst at BNP Paribas Peregrine Securities Ltd.
"What is likely to happen is the pilots association is going to go with the go-slow for a little while longer." For the past week, pilots have followed a union request to abide strictly by their contracts, including turning up no earlier than 80 minutes before takeoff. Cathay said on Sunday that sickness rates have "roughly doubled" since July 3.
The union, the Hong Kong Aircrew Officers Association, repre-sents 1,260 of Cathay's 1,600 pilots. Cathay has fired a total of 52 pilots since the dispute began.
To consolidate its resources, Cathay had temporarily halted flights to Adelaide, Colombo, Cairns, Hanoi, Karachi, Manchester, New Delhi, New York, Penang and Perth. Direct flights between Taiwan and the cities of Osaka and Nagoya in Japan were also suspended.
The airline has also chartered 17 aircraft from Chinese airlines to help carry passengers on some routes. Cathay chartered the extra aircraft from Air China, China Northwest Airlines Co, China Southern Airlines Co, China Southwest Airlines Co, China Northern Airlines Co and China Eastern Airlines Corp.
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