The Hong Kong airline Cathay Pacific, affected by the consequences of the coronavirus pandemic, announced on Wednesday October 21 that it would cut up to 5,900 jobs and close its subsidiary Cathay Dragon.
"Some 5,300 employees based in Hong Kong will be laid off, and about 600 employees based outside Hong Kong may also be assigned depending on the terms of local regulations,"
the company said in a statement.
Cathay Pacific has thus been added to the long list of airlines which are cutting jobs due to the difficulties caused by the coronavirus pandemic.
Read also: Hong Kong: under pressure, the general manager of Cathay Pacific resigns
These job cuts, presented Wednesday as part of a restructuring plan, represent some 17% of the total number of employees of the company.
In total, taking into account natural departures and the hiring freeze, some 8,500 jobs will be cut.
Cathay Dragon, called to disappear, until now carried out short and medium-haul flights in Asia, which will be taken over by Cathay Pacific, subject to the approval of the aviation authorities.
“The worldwide pandemic continues to have a devastating effect and the stark truth is that we have to fundamentally restructure the group to survive,”
airline boss Augustus Tang said in a statement.
Beijing Lightning
Cathay Pacific's revenue plunged 80% year on year in the first half of 2020, according to IATA, the International Air Transport Organization, as the company continues to face significant fixed costs such as wages, maintenance or airport taxes.
Even before the pandemic, the company was already in trouble after months of protests in Hong Kong that deprived it of many customers, mostly from mainland China.
She had also been the wrath of the Beijing authorities because of the support of many of her employees for pro-democracy protests.
In addition, at the start of the pandemic, Hong Kong was already in a recession and Cathay Pacific's accounts were in the red.
To read also: Hong Kong: the former CEO of Cathay Pacific erected as a hero after his resignation
According to Tang, the company spends up to two billion Hong Kong dollars ($ 260 million) every month to waste to keep itself afloat.
With the announced job cuts, Cathay hopes to cut some HK $ 500 million in monthly spending.
According to an optimistic scenario contained in a note to investors, Cathay Pacific hopes to operate next year at half of its pre-pandemic capacity.
