Hong Kong-based Cathay Pacific Airways and its low-cost carrier, HK Express, have submitted bids to retain traffic rights owned by their now defunct sister airline, Cathay Dragon.

The regional Cathay Dragon ceased to operate in late October as part of a wider restructuring plan that slashed more than 5,000 jobs to save the company. As a result, the traffic rights of around 46 routes formerly operated by Cathay Dragon were released for reallocation.

Apple Daily has learned that the flagship airline Cathay Pacific is interested in taking over routes serving major cities in mainland China and in East and Southeast Asia, including Beijing, Tokyo and Kolkata. HK Express, meanwhile, will apply to retain routes to tier two and three cities in the region, including Guilin in China’s Guangxi, Medan in Indonesia and Siem Reap in Cambodia. It is likely that Cathay Pacific has already obtained the route to Kuala Lumpur in Malaysia, where the local regulatory environment is more relaxed.

Cathay Pacific told Apple Daily in a reply that it was seeking regulatory approval to keep the rights to operate most of the Cathay Dragon routes, without detailing the division of labor among its remaining brands.

However, the airline does face competition. Local rival Hong Kong Airlines said that it was evaluating and studying the traffic rights abandoned by Cathay Dragon. An industry insider said that Hong Kong Airlines would primarily apply for traffic rights outside mainland China.

The government’s Transport and Housing Bureau said it was handling the transfer of traffic rights according to established rules and had invited local carriers to submit applications. Encouraging positive competition and the overall effect on Hong Kong’s role as an international hub were among the decision-making criteria, it said.

Cathay’s redundancy exercise was undertaken amid a resurgence in COVID-19 infection cases in the United States and Europe and prolonged travel restrictions across continents.

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