TNAG-0779-FCO40-983-Involvement-of-Hong-Kong-in-air-services-agreements-1978 — Page 168

CONFIDENTIAL

4. IN SPITE OF THE SEVERE DISADVANTAGES SIA ARE ENERGETICALLY PLANNING TO USE THEIR RIGHTS TO SAN FRANCISCO, WHILE CATHAY PACIFIC ARE HOLDING BACK, ROGERS THEREFORE TOOK THE OPPORTUNITY OF A MEETING WITH ADRIAN SWIRE AND DUNCAN BLACK ON 4 MAY TO REMIND THEM OF OUR DISSAPPOINTMENT THAT THEY HAD NOT TAKEN ADVANTAGE OF THIS OPPORTUNITY WHICH HAD BEEN PROVIDED FOR A MAJOR EXPANSION OF · CPA'S ROUTE NETWORK AND TO POINT OUT THAT THEY WOULD HAVE NO GROUNDS FOR COMPLAINT IF SOME OTHER BRITISH CARRIER WERE TO STEP

IN FIRST.

5. WE HAVE ALSO, AS YOU KNOW, RECENTLY BEEN SOMEWHAT DISAPPOINTED BY CPA'S FAILURE TO FILL THE GAP CREATED BY BA'S RELINQUISHMENT OF THE ROUTE BETWEEN HONG KONG AND EAST AUSTRALIA, WHILE WE WERE PREVIOUSLY EMBARRASSED BY THEIR DECISION TO REDUCE CAPACITY ON THE ROUTE TO WEST AUSTRALIA AFTER WE HAD PERSUADED THE AUSTRALIANS TO ALLOW AN INCREASE.

6. WE APPRECIATE OF COURSE THAT CPA ARE A PRIVATELY-OWNED COMPANY WHICH HAS REGARD PRINCIPALLY TO THE PROFITS ON CAPITAL EMPLOYED. HOWEVER, THIS FACTOR ITSELF COULD INVALIDATE ANY COMPARISON WITH AN AIRLINE SUCH AS SIA WHICH ON OCCASION MIGHT HAVE DIFFERENT

OBJECTIVES.

OVEN

•

FILES

MAED

HK & GD

SEAD

. MISS BROWN

MR.MURRAY

[COPIES SENT TO CAD/DOT]

2. CONFIDENTIAL