Cathay Pacific considers drier storage options for unused planes

By Jamie Freed

SYDNEY (Reuters) - Hong Kong's Cathay Pacific Airways Ltd said on Monday it was evaluating whether to send some of its aircraft to less humid locations for storage as it reviews the size of its fleet in light of the fall in demand due to the pandemic.

Rivals Singapore Airlines Ltd, Qantas Airways Ltd and Air New Zealand Ltd have already sent some long-haul planes to desert locations in Australia and the United States for long-term storage and possible early retirement in expectation the demand slump will be prolonged.

Cathay is examining plans to store more than 50 widebody aircraft from its fleet of around 236 planes outside Hong Kong in less humid locations like Dubai and the Australian desert, a source familiar with the matter told Reuters on condition of anonymity.

Cathay declined to comment on the number being considered for storage but said they were from a number of different fleets within the group, which operates the Cathay Pacific, Cathay Dragon and Hong Kong Express brands.

"We are exploring alternative locations beyond Hong Kong's humid summer climate that can provide appropriate conditions for our aircraft while they are not flying," Cathay said in a statement in response to questions from Reuters. "This is a prudent decision from an asset management perspective."

The airline has previously said it is undertaking a comprehensive review of its operations and will make a recommendation to the board on the optimal future size and shape of the group by the fourth quarter.

Cathay last month said it would receive a $5 billion rescue package to help it weather the coronavirus pandemic, led by the Hong Kong government.

(Reporting by Jamie Freed; Editing by Stephen Coates)