Read Beyond Lion Rock: The Story of Cathay Pacific Airways Online
Authors: Gavin Young
Beckman (sadly): ‘Poor Mr Bebchick….’
Bebchick: ‘I think the record should be clear….’
Chairman: ‘Mr Bebchick and Mr Beckman, this hearing has not yet become a television serial, although it seems in imminent danger of becoming a serial without the television…. Let us just get on with things. Let us take a break for five minutes while we all cool down and then let us carry on.’
When one evening Mr Bebchick said he would pop his ‘final question’ to a long-suffering witness, BA’s Philipson muttered, ‘I hope it will not be a leading one.’
To this Bebchick remarked: ‘A leading question is one which requires the witness to answer yes or no. That is the American definition.’
The weary Chairman groaned: ‘Perhaps we could do with more of those questions! Mr Bebchick, if I have understood the American way of life and terminology correctly, we are eighteen minutes into the “happy hour”.’
*
These rhetorical high jinks were the leavening in hearings that were at bottom very weighty. At the end of it all the CAA’s decision was awaited with bated breath and very few smiles. When it came, on 17 March 1980, ATLA’s decision was overturned. British Caledonian was the only one of the three airlines to be granted a licence to fly between Hong Kong and London.
Laker was ruled out because the CAA doubted that Sir Freddie’s ‘forgotten men’ existed at all, at any rate in significant numbers. ‘As far as Hong Kong is concerned there is no significant charter market from which scheduled services can divert traffic.’ The CAA also doubted Laker’s ‘ebullient forecast’ of massive holiday traffic. Hong Kong was
not
Miami or Los Angeles. ‘The Authority must regretfully regard the “forgotten man” as a myth; there is certainly no evidence that he is waiting hopefully for the opportunity to travel between London and Hong Kong.’
But why did the CAA choose BCal over Cathay?
It is worth quoting the report’s relevant paragraph in full because the answer, in retrospect, is a very odd one indeed.
Given its conclusion that the route will stand only one additional operator, the Authority is faced with the unenviable task of choosing between Cathay and BCal…. The conclusion is that Hong Kong and the public would best be served by granting the licence to BCal, whose aircraft size is better tailored to the needs of the route at its present stage of development. The Authority fully understands the desire of the Hong Kong Government for Cathay to be licensed. There would be some advantage in the route’s being developed by a carrier based at the Hong Kong end. Cathay is well placed to develop Asian traffic from its Far East network and it already has the advantage of rights between Hong Kong and Bahrain. However, the Authority does not consider that these advantages outweigh the disadvantage that Cathay could not satisfy the needs of the market as well with its 747s as BCal could with its DC-10s.
The next paragraph surmised that political considerations influenced Hong Kong’s ATLA to grant Cathay a licence rather than ‘the harsh logic of the economic analysis’. It went even further than that, implicitly warning the Secretary of State for Trade that, should he overturn this decision of the CAA (it was in his power, and his alone, to do so), he would be saying in effect that ‘it was more important to give Cathay Pacific a place in the sun
than to provide the service which is clearly better for the travelling public’. No wonder Duncan Bluck’s copy of the report at this point is splattered with angry exclamation marks and one ferociously scribbled word –
‘Rubbish!
’
The news of Cathay’s rejection fell like a stun-grenade among the Company’s directors and employees alike. Mike Hardy, the present Director of Flight Operations, was in Hong Kong waiting at a traffic light. His wife, in another car, was alongside. Their car radios were tuned to the news and the CAA decision was announced at that moment. They sat there dismayed and unbelieving, staring at each other through their car windows. The lights changed and they still sat there. ‘Cars were hooting impatiently,’ Mike says. ‘Drivers were shouting at us. But we had heard the news. We just couldn’t believe it. BCal had got the London route. We were nowhere. Impossible!’
In Manila, in the flat of Duncan Pring, Cathay’s Philippines
representative
, guests were assembling for a small dinner party. His wife was pouring drinks. A telephone rang and Duncan went to answer it. He came back with an expression of doom on his face. Cathay refused! It was as if all the lights in the flat had gone out.
Cathay Pacific lost no time in preparing an appeal to the then British Minister of Trade, John Nott, and Duncan Bluck called a press conference in Hong Kong to tell journalists that the basis of the Company’s appeal against this ‘extraordinary’ CAA decision would be public preference for Cathay’s 747s and the desire of Hong Kong people to see Hong Kong-based Cathay on the route: ‘We are not appealing on the legality of the matter, but rather on the morality of it,’ he said.
It seemed clear to Bluck, to Adrian Swire and other Cathay directors, that the CAA decision was based essentially on the dubious premise that the smaller DC-10 was a more suitable aircraft for the route than the Jumbo 747. They hoped the Colony’s Governor, Sir Murray Maclehose, would share their outrage and mobilize the Foreign Office in London (and Lord Carrington, the Foreign Minister) behind Cathay’s case. Cathay had been insulted – treated by Colegate’s CAA like ‘a 2nd XI colonial airline striving unjustifiably to force its way into the profitable long-haul UK-based preserve of pukka U.K. independents’. It would now be necessary to mount a wide press campaign in Hong Kong, to gain support from local Chinese administrative bodies and so on. ‘Inevitably and sadly’ – there one hears the patriotic voice of Swire – ‘this campaign would have to follow the perfidious Albion line.’
It must have seemed like perfidious Albion indeed. At the headquarters of John Swire & Sons, Mr Heseltine’s smiling intervention over the TriStars
on behalf of Rolls-Royce and the TriStar had not been forgotten. A joint telex from Adrian, Bluck and Bremridge to Michael Miles, Managing Director in Hong Kong, ended with these words:
We have now reached the ludicrous situation where the U.K., having leaned on Cathay to prevent it buying the DC-10, is now proposing to richly reward BCal purely for having done so.
It was not in the least surprising that this theme recurred in a letter from Adrian to Bluck a little later as they waited on tenterhooks for John Nott’s decision on Cathay’s appeal. If the decision went against them, ‘We must react very quickly and positively if we are to extract the maximum from an injustice of this kind.’ Among other things, they should demand an immediate meeting with John Nott. The purpose of such a meeting would be – partly – ‘to put on record that, in our view, HMG had let us down/double-crossed us on a very fundamental matter, and that this double-dealing gravely undermines our faith for the future in HMG’s evenhandedness….’ The fundamental matter referred to was, of course, the pressures that had been brought to bear ‘to make us change our DC-10 order to the Rolls-Royce-powered Lockheed 1011’.
The result of the appeal was expected in June 1980. Meanwhile speculation and backstairs activity carried on apace.
On the adverse side, Duncan Bluck reported that certain people in ΒA were now in a bloody-minded mood and making it clear that they would do their best ‘to run us off the London route’ if Nott did allow them on it. On the other hand Michael Miles, invited to dine
à trois
with a local friend and John Nott in Hong Kong on a visit, reported that Nott was ‘very relaxed’ and spoke sympathetically of ‘Cathay’s natural claims’ to the route. Nott also struck Miles – as he struck numerous others – as a man of very independent mind. He was well briefed, too, and obviously had a good grasp of Cathay’s problems. That sounded just what everyone in Cathay wanted to hear.
Popular support for Cathay in Hong Kong gathered momentum. Everyone who was anyone wrote in to call for the overturn of the CAA’s ‘outrageous decision’. That included the Chinese press. For example,
Wah
Kiu Yat Po
:
The CAA considered BCal’s DC-10s to be more suitable for the route than Cathay’s 747s. Such reasons are incomprehensible since BA which is at present monopolising the route is also using 747s. We can predict that about half the would-be passengers on the Hong Kong–London route will be orientals and it is only justifiable that Cathay, as an
experienced airline
servicing Asian countries
should be granted the licence…. A majority of passengers would certainly pick Cathay as their first choice. So the CAA’s worry about the shortage in passenger demand is unjustified.
The Hon. O. V. Cheung in the Legislative Council had this to say:
Cathay was encouraged to buy UK equipment. They specified their 747s should be powered by Rolls Royce engines. So far they have invested
£
70 million in Rolls Royce engines to that end and plan to invest
£
10 million a year on other equipment in furtherance of reciprocity….
And a columnist in
Sing Tao Jih Pao
wrote under the headline ‘Hong Kong Loses Face’ something much stronger, something that underlined in thick black strokes of the pen how much Cathay Pacific and the Hong Kong Chinese population had come together:
I vaguely remember an anecdote in Dr Lin Yu-tang’s book. It went like this: one day in the 19th century, a Chinese ambassador was walking in his clumsy padded quilt coat on a street in Washington, D.C., and coming across a swaggering American who asked, ‘What the hell are you? Japanese? Chinese? or Siamese?’
The Chinese Ambassador replied coldly, ‘What are you anyway? A monkey? An ass or a Yankee?’
This of course, happened in the age of gunboat diplomacy when China was generally regarded as a colony, or simply a geographical term instead of a sovereign state. The Chinese were then treated as hordes or coolies next only to dogs which were prohibited to enter public parks in the international settlement of Shanghai.
In this century, we may be sure that apart from sarcasm, mockery and animosity, this kind of thing could not have happened. But when the news of Cathay Pacific Airways being rejected to operate the Hong Kong–London route came, the people of Hong Kong had the same feeling as that of the Chinese Ambassador a century ago. Ironically, the British Civil Aviation Authority is probably not aware of the extent to which the self-respect of Hong Kong Chinese was hurt. Despite the fact that CPA is being operated by British, Hong Kong people long regarded CPA as their own airline. It’s
well-run
, providing good services, making profit every year and gaining ‘face’ for Hong Kong, and it’s the envy of many.The predominant Chinese community here has reasons to feel being betrayed and discarded. They take the rejection on as an unfair treatment and even an insult. To the Hong Kong Chinese, nothing could be more ‘
face-losing
’ than having their own Hong Kong airline being denied the right to operate Hong Kong’s own route. Hong Kong has always looked upon U.K. as the ‘mother’ country. Now the Civil Aviation Authority’s decision to turn down CPA is an eye-opener. It is clear that this ‘mother’ not only fails in her
duty but is – with a slight association of idea – so obnoxious that she could be prosecuted for maltreating her child. It is indeed sad to see that U.K. is so down and out as to have to protect herself against her own colony – a most humiliating page in the annals of Britain. It is a shame that she had to stoop so low as to take an action that would have been denounced in the 19th century. In fact, there is and will be plenty of room for both CPA and British Caledonian. The U.K. CAA could have taken a leaf out of Confucius’ teaching and dealt with the matter in the principle of ‘giving others that you want for yourself’. At any rate, one cannot very well say ‘this is the finest hour of Britain’. U.K. CAA’s decision is as unfair to Hong Kong as it is unworthy of Britain.
There was lots more from elsewhere – all in the same outraged vein.
The time and the agony dragged on. Then, on 17 June, during a joyful Hong Kong Association Dragon Boat dinner chaired by John Swire (on tenterhooks) at the Dorchester Hotel in London, the Minister made a witty speech. In the course of it, Mr Nott announced that he would overturn the CAA ruling. Cathay Pacific, Laker Airways as well as BCal were to be licensed to join ΒA on the Hong Kong route. The Minister gave several reasons for his decision. In his view the Authority had been unduly dismissive of the possibility of substantial new traffic being generated by a wider choice of services. He did not himself altogether dismiss, for example, the possibility of ‘many, many forgotten men and women at the bottom end of the market’. Anyway, a wider choice of carrier was obviously what users of the route, having suffered under the BA monopoly, should be given. Particularly gratifying – it made John Browne at his table at the Dorchester snatch gleefully for the champagne and John Swire mentally tear up a biting indictment of Westminster’s perfidy that he had prepared in case Cathay was rejected – was the fact that Mr Nott found it quite unreasonable that a second airline based in Britain had been granted exclusive rights to fly the Hong Kong route when there was an airline with a Union Jack on its tail – Cathay – in that territory very willing and very able to participate. After that John Swire’s dignified speech was a purr of satisfaction and relief. A serious obstacle to Hong Kong–UK trade was now removed, he said.