Hong Kong based Cathay Pacific is replacing Singapore Airlines (SIA) as the dominant Asian carrier as the air travel market in Asia undergoes rapid growth and structural changes.
Many factors are responsible for Cathay’s better performance than SIA in the last few years.
Singapore Airlines is more exposed to the fall in demand for air travel due to the economic crisis in Europe while Cathay is more dependent on the recovering North American market.
Due to its closer location, Cathay’s Hong Kong hub is far better at harnessing the rapidly growing Chinese passenger market than is Singapore. No doubt, the dismal on-time performance at mainland Chinese airports also influences Chinese travelers to prefer Hong Kong.
Because of its location, SIA is more vulnerable to competition from the fast-growing Gulf carriers -Emirates, Qatar, and Etihad.
Cathay has also met success with its launch of a true Premium Economy Class, something not offered by SIA.
However, the situation may change in near future, especially if the Singaporean carrier is able to properly harness the Indian and Indonesian markets.