Asian airlines taxi for take-off


Cathay Pacific Airways Ltd net profit plunged 87 percent last year

From Lisa Barron
CNN Correspondent

HONG KONG, China -- The flagship carrier of Hong Kong, Cathay Pacific, says it will create 1,300 new jobs in the next two years.

The statement marks a a dramatic turnaround from eight months ago, when the airline imposed a hiring freeze.

Last month, Cathay also announced it had placed orders for six new aircraft and said it will bring the five planes parked during the depths of the downturn back into service.

"It signifies confidence in the future for us," Tony Tyler, Cathay Pacific Corporate Affairs director told CNN.

"Traffic is coming back and, while yields are still low, we're confident that we'll be able to manage the growth better if we put more aircraft into the air, and obviously that means more jobs," he said.

There was more good news for the region, with the world travel and tourism council saying they expect Asia-Pacific markets to lead the way in a massive global recovery in the travel industry next year.

Among the biggest winners in the predicted rebound, according to the council, will be industry workers in the region.

"Virtually all the airlines within the region have mostly reversed all the cuts in both capacity and employee numbers following September 11, " ING Barings aviation analyst, Phil Wickham told CNN.

"They are now pretty much all going back to a full schedule. I would expect them to begin to start adding staff, probably in the second half of this year," said Wickham.

Advertising spend up

Australia's biggest carrier, Qantas, is also adding aircraft, leasing six Boeing jets for use on new non-stop domestic services by the end of next month.

Airlines have also started buying more advertising in Asia.

Advertising expenditure by major regional carriers plummeted more than 80 percent in the fourth quarter of last year, compared with the same period in 2000.

Analysts say spending in the past few months has signaled a reversal of those fortunes.

"I expect (it will) go back to the normal pattern for the industry," says Wickham,

"I think we're almost there, and it normally accounts for between 1-2 percent of their revenues."

Still, analysts say it is likely to be a return to the heady days of 2000, meaning consumers in Asia can still expect to see bargains on offer -- at least until the industry is on more solid ground.