Cathay Profit Margin Strained as Fuel Hedging Losses Mount
- Carrier may report net income fell 46% in first half of 2016
- Airport levy threatens to depress fares already under pressure
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Cathay Pacific Airways Ltd., the marquee Hong Kong airline, suffered millions of dollars in losses from fuel-hedges in the past two years. With the city’s government adding new fees on passengers to fund building a runway, the carrier faces more challenges to retain profit margins.
The charges to fund the expansion of the Chek Lap Kok airport follows the city government banning from February fuel surcharges airlines could levy after crude oil prices tumbled to as low as $26 a barrel.