Cathay Pacific layoffs | Cathay Pacific announces restructuring plan to cut 8,500 jobs, Dragonair ceases operations today

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Author: Yuan Shu Kong Fanxu

2020-10-21 07:51

Last update date: 2020-10-21 08:28

The new crown pneumonia epidemic is raging around the world. With the implementation of "customs closure" prevention and control measures in many countries, the tourism industry has almost ceased, and airlines have also fallen into an unprecedented "ice age". Cathay Pacific and Dragonair previously abandoned applications for the second round of employment protection programs It is accused of paving the way for layoffs, and there has been news of substantial layoffs recently.

[08:14] Cathay Pacific Airways, which has been rumored to be layoffs and reorganization, today (21st) announced its final plan to lay off 8,500 employees.

You are the leader of the local aviation industry. Cathay Pacific has been rooted in Hong Kong for more than 70 years. There have been countless years of prosperity. It has also been named the best airline in the world. Unfortunately, its performance has declined in recent years and the failure of oil futures investment has caused losses. 30 years of "blue chip" status.

Under the epidemic, the global aviation industry is in recession, and the temporary recovery is indefinite. Cathay Pacific, which has experienced many industrial storms, Asian financial turmoil, and SARS, also requires government capital injection for unprecedented proportions.

"Hong Kong 01" looks back on Cathay Pacific's past 70 years of history.

Extended reading: A review of Cathay Pacific’s history once lost its blue chip status

[08:28] Cathay Pacific announced its restructuring plan, the first of which is to announce that Dragonair will cease operations from now on. "Hong Kong 01" recalls that Dragonair has become a competitor from Cathay Pacific and has been taken over.

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.

Extended reading: Farewell to Hong Kong Dragon, Cathay Pacific, finally withdrawing the brand after 14 years of whale

[08:06] Cathay Pacific said that the most optimistic estimate is that the passenger capacity in 2021 will be much lower than 50% in 2019; it also said that it is assumed that the vaccine currently developed is proven effective and can be successfully launched globally next summer , The company believes that the capacity will gradually pick up until the second half of next year.

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[07:54] In the announcement, Cathay Pacific’s management put forward three major elements of the restructuring plan, including:

1. Dragonair ceased operations today.

2. The layoffs of 8,500 employees, accounting for 24% of the employees, were mainly based in Hong Kong, with 5,300 accounting for more than 60% of the layoffs. Another 600 non-Hong Kong employees may be affected; recruitment was frozen and 2,600 positions remained vacant.

3. The cabin attendants and pilots stationed in Hong Kong will be required to agree to change their service conditions, so as to achieve the goals including bringing salary closer to productivity and enhancing market competitiveness.

The restructuring cost is approximately 2.2 billion yuan,

[07:52] Cathay Pacific issued a notice this morning, announcing its restructuring plan, layoffs 8,500 employees, accounting for 24% of its employees.

The number of layoffs is larger than the previous plan.

Among the 8,500 positions, about 5,300 employees stationed in Hong Kong will be laid off in the next few weeks, and about 600 non-Hong Kong employees may be affected, subject to the regulatory requirements of the relevant regions.

Cathay Pacific reportedly announced its layoff plan on Wednesday as soon as possible

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Cathay Pacific's passenger capacity plunged by 98% in September, expected to operate passenger capacity below 50% next year

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Cathay Pacific's passenger traffic in September is still down 98.1% year-on-year thanks to students studying in the UK, and its capacity next year will be less than 50%

Cathay Pacific layoffs｜The layoff plan will be announced as soon as this week, or about 4000 employees will be involved

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Cathay Pacific layoffs