Avios Redemption University – Lesson 16 – Using Cathay Pacific for low-tax Avios redemptions to Asia

The “Avios Redemption University” series is a good starting point for beginners, although I hope everyone will learn something from them.  Click here to see the other articles.

Today I want to take a look at how you can make substantial tax savings – although not Avios savings – when flying to Hong Kong on Cathay Pacific.

You can’t use a British Airways American Express 2-4-1 voucher on Cathay Pacific so this strategy is better for the solo traveller or someone who has already used their annual voucher.

Cathay Pacific Avios

Cathay Pacific is a fellow member of the oneworld alliance, alongside BA, so you can redeem your Avios for their flights.  Availablity is generally very good – insanely good out of Dusseldorf, where you will usually find eight Business Class seats available.  Only some routes have First Class.

Let’s look at BA redemptions first

When booking redemptions to Hong Kong on BA there is one vital fact to remember.  By law, there are NO fuel surcharges on flights originating in Hong Kong.  This does not apply to return legs of flights starting outside Hong Kong.

What this means is that you MUST book Hong Kong BA redemptions as 2 x one-way flights.  If you do this, there will be no fuel surcharge on the inbound flight.  If you book it as a return flight you will pay a fuel surcharge on the inbound flight.

The snag, of course, is that by booking 2 x one-ways you cannot use your British Airways American Express 2-4-1 voucher ….

The impact of booking 2 x one-way redemptions on British Airways

British Airways business class RETURN flight, London to Hong Kong – 180,000 Avios + £487

Or when booked separately:

BA outbound – 90,000 Avios + £332

BA inbound – 90,000 Avios + £10

Total – 180,000 + £342, saving £145

These numbers are based on peak day redemptions.

Save a little tax when you fly Cathay Pacific from London

If you choose to fly Cathay Pacific instead of British Airways from London, you will make a further saving:

Cathay Pacific business class (London to Hong Kong):  180,000 Avios + £198

You save £144 over a British Airways redemption.

This is based on a peak day redemption.

Ex-Europe is even more interesting!

Cathay also flies to Hong Kong from Manchester and various other European starting points.  The tax numbers are exceptionally good, as low as £29 return!

Manchester to Hong Kong:  180,000 Avios + £168

Amsterdam to Hong Kong:  180,000 Avios + £29

Dusseldorf to Hong Kong:  180,000 Avios + £61

Frankfurt to Hong Kong:  180,000 Avios + £77

Madrid to Hong Kong:  210,000 Avios + £31

Milan to Hong Kong:  180,000 Avios + £34

Paris to Hong Kong:  180,000 Avios + £83

Rome to Hong Kong:  180,000 Avios + £44

Zurich to Hong Kong:  180,000 Avios + £36

As you can see, there are some big savings to be made here compared to the British Airways surcharges of £342.  You need to factor in the cost of getting to and from your departure airport, of course.

The snag …. off-peak pricing

There is one thing which may make you think twice about Cathay Pacific.  If you book on a peak day (which, for 2017, will be every school holiday day for a start) there is no difference in the Avios required.

Fly on a British Airways off-peak day and the Avios required fall to 150,000 per person, return, in Business Class.  This offsets the saving in taxes and charges.  Cathay Pacific, of course, still has arguably a far superior product as a look at online reviews will show.

Bits: BA 'enhancing' First Class menus, final call for Azimo £10 Amazon voucher and 'buy SPG points' deals
Bits: Radisson / Park Inn / Park Plaza taken over by Chinese group, Radisson's new family package
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Comments

  1. can’t beat 85,000 Alaska miles for CX J return between Europe – Hong Kong

  2. Raffles, more a hypothetical question, if you book a return (not 2 singles) the fuel surcharges that BA load on an outbound HK flight, where does that go? Not to the relevant HK tax authority… Why aren’t BA able to reflect lower taxes in a return ticket? This doesn’t seem right to me!

    • Because they don’t have to.

      Try this question – American Airlines does not charge fuel surcharges. An AA flight from London to the US just incurs APD when using AA miles. BA, however, whacks on a £300 fuel surcharge when you use Avios to book the same AA flight. Where does that money go? Into BA’s pocket of course.

    • Evidence right here that the decade of marketing diversionary tactics by BA have worked. Where a customer thinks someone other than BA is charging the fuel surcharge.

  3. I still think given the frequent Qatar and other airline J sales, you would hard pressed to get much value by booking this route at 180k avios return + tax, regardless of the tax amount. I suspect if you worked it all out, you would often be getting less than .5p an avios of value with this redemption, compared to an avios earning cash booking. Depends if you are avios rich I guess (I am not)

    • Fair point …. £1629 for cash in Cathay J in the current sale so you are looking at not much more than 0.5p. Valuation is partly driven by how you earned them though …. if they all came from business travel with no effort on your part then you’d probably be happy.

  4. Andrew H says:

    O/T – just got my 2000 avios in Iberia account. Check your accounts.

  5. Anything similar for tokyo rather than hkg?

    e.g. BA (UK) vs. JAL/ANA (ex-EU) I forget which is a OW member.

  6. Scallder says:

    Slightly OT – BA quarterly results included this:

    “Revenue trends in quarter two have been affected by the aftermath of the Brussels terrorist attacks, as well as some softness in underlying premium demand. As a result, IAG has moderated its short term capacity growth plans.”

    I wonder what the growth plans were which they’re putting on the shelf?

    Some softness in underlying premium demand – sounds a poor way of saying we’re losing out to our competitors. Not surprising given the high cost and comparatively poor product compared to ME3/CX etc

  7. Cathay also (rather bizarrely) fly from New York to Vancouver. Recently booked this, seemed like lots of availability on this route. Couldn’t get uk-Vancouver flights on BA so booked lhr-jfk with Virgin then Cathay after a few hours in the lounge.

  8. WilliamPH says:

    Booked a Premium Economy flight using Avios from SIN to HKG, and aircraft change/ overbooking means that we are in business this morning. According to the FT Cathay board this is a regular occurrence on the route. And if we hadn’t been upgraded could have coped with PE on Cathay – no worse than Club Europe

  9. Bariummeal says:

    Two weeks ago I flew LHR – HKG in Business and back in First with Cathay – 210k avios and around £180 charges. Would have started in AMS to get chsrges down to £19 but didnt have time. Business was great – though lounge closed so did a tour of AA, BA and then a rammed Number 1 lounge (which Cathay temp use). However, First was exceptional – beautiful PYE pajamas, service and food really fabulous. The lounge – The Pier which is run by Peninsula Hotel is beautiful with very high quality food in the full service restsurant. The return flight time was ideal – 2pm flight landing in LHR at 8.30pm – so enjoy the service, land go to bed and wake up ok for Monday.

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