CIVIL AVIATION POLICY DIVISION
The Secretary
Civil Aviation Authority
CAA House
45-59 Kingsway
London WC2
Dear Madam
DEPARTMENT OF TRADE
1 VICTORIA STREET
LONDON SWIH OET
TELI PHONE DIRECT LINE 01 213
SWITCHBOARD 01 215 78.
17 June 1980
I refer to the appeals by Cathay Pacific Airways Ltd (Cathay), Laker Airways Ltd (Laker), and the representations of the Government of Hong Kong against the decision of the Civil Aviation Authority (The Authority) in respect of application 1B/24429 by British Caledonian Airways Ltd (BCal), 1B/24437 by Cathay and 1B/24430 by Laker for the route London (Gatwick) to Hong Kong.
The Secretary of State has considered the appeals under Regulation 16 of the Civil Aviation Authority Regulations 1972 as amended.
In reaching his conclusion the Secretary of State has acted in accordance with Section 24(6) of the Civil Aviation Act 1971 which requires that he should have regard in particular to the duties imposed on the Authority by Section 3 of that Act. He has had the following considerations in mind:-
(a) There is a wide divergence between the forecasts of traffic
on the route provided on the one hand by BCal and Cathay, on the other by Laker; the former based theirs on growth of the existing market while Laker predict that new types of low fare will open up a much wider market. In his view the Authority has given undue weight to the lower traffic forecasts of BCal and Cathay; was unduly dismissive of the possibility of substantial new traffic being generated by a wider choice of services ("the many, many forgotten men and women at the bottom end of the market").
(b) He considers the Authority places too great an emphasis on the
economics of the proposed additional services in the short term.
(c) It is clear that it would be in the interests of the users of
the London-Hong Kong services that they be offered a wider choice of service than exists at present.
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