Cathay Pacific Airways Ltd has sufficient freight capacity despite a delay in the delivery of new 747-8F freighters from Boeing Co, its chief executive said Tuesday.

"We're obviously disappointed that the delivery of the Boeing 747-8 Freighters has been delayed," Tony Tyler, chief executive of Cathay, said on the sidelines of a media event. "But when we look at the cargo capacity plan for next year, we are confident that we can provide the necessary capacity to serve the market well."

Cathay had planned to begin taking delivery of 10 Boeing 747-8Fs from January 2011, but Boeing has postponed delivery to mid-year because of a low-frequency vibration in certain flight conditions.

Hong Kong is expected to see another record year for air cargo throughput in 2010, maintaining its position as the world's busiest international air freight market, C.K. Ng, deputy director of airport operations of Hong Kong's Airport Authority, told media in the same day.

Boosted by a strong recovery in passengers and cargo, Cathay, Asia's fourth-largest carrier by market value, is expected to see net profit double to a record HK$9.7 billion this year, according to Thomson Reuters.

Despite the rebound, Cathay's premium revenue had not reached levels from before the global downturn, but had seen steady improvement over the past year, Tyler said.

"We are seeing a good pick up this year in our premium traffic and that's obviously good for us and for Hong Kong," Tyler said. "We are heading into the busy time for premium passengers this season."

Cathay and subsidiary Dragonair saw their combined passenger volume rise 10 percent to 17.9 million in the first eight months of the year on robust demand out of Hong Kong and solid demand in China. But premium revenue and volumes remain below pre-downturn levels.

Cargo tonnage rose 22 percent during the eight months, although August cargo traffic was not as strong as the previous month in terms of volume.

Meanwhile, sources said Cathay will replace economy-class seats in long-haul planes after passengers complained about discomfort.

The existing coach seats, which have fixed-backs to prevent passengers from disturbing the person behind them when reclining, will be refitted and moved to short-haul and regional aircraft, according to three people familiar with the plan.

"There's been a lot of criticism of the seats," said Shaun Rein, managing director of Shanghai-based China Market Research Group, which does consumer surveys for airlines and other clients. "It seems that Cathay is listening."

The airline will also overhaul business-class and first-class seats as part of the long-haul refit, which includes Boeing 777-300ERs and some Airbus SAS A330s, according to the people.

"While our passengers value the protection of living space afforded by the fixed backshell seat, we are constantly looking for ways we can further improve our products and services," Carolyn Leung, a Cathay spokeswoman, said in an emailed reply to Bloomberg questions.

Cathay will also add premium-economy seating in the long-haul revamp that will begin next year, said the people.

Bloomberg - Reuters

(HK Edition 10/13/2010 page3)