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Author: Chen Qianting
2020-10-21 08:23
Last update date: 2020-10-21 08:23
Cathay Pacific reorganizes its subsidiaries Cathay Pacific, Cathay Dragon, and Hong Kong Express. In the future, it will cancel the Dragonair brand. It is expected to operate low-cost airlines under the name "Cathay Express". The others will be operated by Cathay Pacific ( Cathay Pacific) operations.
Cathay Pacific Airways is one of Hong Kong's local airlines. It acquired local competitor Dragon Air in the 1990s and spent about 5 billion yuan to acquire HNA’s low-cost airline Hong Kong Express last July, overturning Cathay Pacific’s previous claims that it did not participate. The position of the low-cost airline business.
At that time, Cathay Pacific CEO and Chairman of Hong Kong Express He Gao sent a letter to employees saying that Hong Kong Express will not merge with Cathay Pacific and will continue to develop independently in the direction of low-cost airlines.
▼Cathay Pacific swallows Hong Kong Dragon to purchase HK Express to see the history of the Big Mac▼
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Cathay Pacific Airways was established in 1946 and was acquired by the British-owned commercial firm Swire Pacific (the predecessor of Swire Group) two years later. However, it has undergone several shareholding changes since the 1980s. Even though Swire Pacific is still the largest shareholder of Cathay Pacific, it holds approximately 45% of the shares. But Air China also holds nearly 30%.
Acquired the shares of Dragonair successively since the 1990s
Cathay Pacific’s local competitor in the last century was Dragonair. In 1985, the "Hong Kong Macau International Investment Co., Ltd." composed of businessmen Cao Guangbiao, Bao Yugang, Fok Yingdong and Chinese-funded institutions China Resources and China Merchants was established. However, due to continuous losses, In 1989, Cathay Pacific deployed Dragonair to take over Dragonair as its second largest shareholder the following year.
Acquired the cross-shareholding of Dragonair and Air China in 2006
In 2006, Cathay Pacific announced that it would spend 8.22 billion yuan to fully acquire Dragonair.
At that time, the main shareholders of Dragonair included Air China. Cathay Pacific acquired Dragonair and reached an agreement with Air China. Cathay Pacific increased its stake in Air China. Air China also purchased shares of Cathay Pacific, turning Cathay Pacific and Air China into a cross-shareholding relationship.
In 2016, it was renamed "Cathay Dragon", with the flying dragon pattern only on the nose
In 2016, Dragonair changed its name to "Cathay Dragon", and the "red dragon" on the tail was no longer. It was replaced with the same "shark fin" as Cathay Pacific, but kept the small flying dragon on the nose.
Taking advantage of HNA's financial difficulties to acquire Express and set foot in low-cost airlines
In the millennium, two local airlines sprouted, including Hong Kong United Airlines, with gambling king Stanley Ho as the major shareholder. The company initially focused on routes from Hong Kong to second-tier cities in the Mainland, but the passenger capacity continued to be sluggish.
Since 2006, Stanley Ho reduced his shareholding, and the Chinese HNA Group became the de facto major shareholder. The company changed its name to "HK Express" the following year.
By 2013, the fast-operating type was a low-cost airline, which launched more short-haul routes, and increased the number of destinations in unpopular cities in Japan, which was popular with Hong Kong people, and the company's operating conditions turned losses into profits.
Cathay Pacific, which has a market value of nearly 55 billion yuan, said in the early years that it would not participate in the low-cost airline business. However, by 2019, Cathay Pacific announced that it would spend 5 billion yuan to acquire Hong Kong Express. At that time, Cathay Pacific issued a statement saying that Hong Kong Express had captured a unique marketing department. This, in conjunction with Cathay Pacific Group’s extensive aviation network, will multiply the connection power of flights to and from Hong Kong.
The rapid rise of low-cost airlines in recent years has affected the market share of traditional airlines, forcing Cathay Pacific to follow the wind.
The only local airline is Hong Kong Airlines. The parent company is the Chinese-funded HNA Group. It was originally a sister company to Hong Kong Express. In recent years, it has suffered financial difficulties and its fleet decreased at the beginning of the year. In February, the company also announced the need to respond to the new coronavirus pneumonia epidemic. Cut 400 employees.
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