B
GR 295
CONFIDENTIAL
HKK18411
NO. 51
99
PRIORITY
CYPHER/CAT A
FM HONG KONG 170600Z
CONFIDENTIAL
MOLX
OF
Nota
TO PRIORITY F.C.O TELNO.191 OF 17 FEBRUARY 78,
INFO PRIORITY WELLINGTON (FOR ROGERS),
ROUTINE KUALA LUMPUR.
FOLLOWING FOR D.O.T.
'STRY
Taken
-
ধ
6110
See (103) (106)/110)
YOUR TELNO.ALLOT 33 U.K/MALAYSIA AIR SERVICES.
CPA ADVISE THAT THE STATISTICS PRESENTED AT PARAGRAPH 3 OF TEL UNDER REF ARE SOMEWHAT OUT OF DATE. THE CURRENT SITUATION IS
THAT MAS ARE AVERAGING 63 PASSENGERS PER FLIGHT IN EACH DIRECTION.
YOU WILL BE AWARE THAT THEY OPERATE THREE FLIGHTS PER WEEK IN COMPARISON WITH CPA'S TWO FLIGHTS PER WEEK WHICH CURRENTLY AVERAGE 43 PASSENGERS PER FLIGHT BETWEEN BKI AND HKG. DURING THE PAST YEAR THE MAS AVERAGE LOAD FACTOR HAS FREQUENTLY BEEN IN THE 70'S AND HAS TOUCHED 79 PERCENT AT PEAK PERIODS. WITH THE NORMAL DISTRIBUTION OF TRAFFIC FLOW THIS ALMOST CERTAINLY MEANS THAT THERE HAS BEEN SEAT CAPACITY LIMITATION FROM TIME TO TIME AND MAS HAD TO TURN PASSENGERS AWAY. WE THEREFORE FEEL THAT INCREASE OF CAPACITY TO 146 SEATS PER FLIGHT WILL HAVE REAL MEANING AND WILL NOT ONLY REDUCE THE NUMBER OF PASSENGERS ON CPA BECAUSE OF THE FACT THAT MAS WILL HAVE ADEQUATE CAPACITY BUT WILL ALSO AT TIMES LEAD MAS INTO FURTHER SUBSTANTIAL DISCOUNTING, ALL OF WHICH ADDS UP TO SEVERE DEPRIVATION OF CPA'S RATHER POOR SHARE OF THE MARKET. CPA EARNINGS HAVE BEEN ONLY ABOUT 40 PERCENT OF THE EARNINGS OF MAS ON THE PROBABLE INVALID ASSUMPTION THAT THE YIELDS OF THE TWO AIRLINES ARE SIMILAR. CPA HAVE SUGGESTED AN UNLIMITED 50-50 POOL AS BEING A
POSSIBLE SOLUTION OF THEIR PROBLEM BUT WE FIND THIS UNACCEPTABLE.
/ WE THEREFORE
CONFIDENTIAL