Written by: Yuan Shu, Kong Fanxu, McCain, Huang Weilun, Chen Jiayi
Last update date: 2020-10-21 09:49
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.
Cathay Pacific finally issued a notice this morning, announcing a restructuring plan and cutting 8,500 positions.
Among the 8,500 positions, about 5,300 employees in Hong Kong will be laid off in the next few weeks.
[09:39] Senior human resources consultant Zhou Qiping said that in the current downturn in the aviation industry, employees in the industry can only change careers, and there is not much advantage. "The flight attendants are no different from ordinary waiters and customer services."
Both Su Weizhong, general manager of Hezhong Personnel Consulting Co., Ltd., and Zhang Huimin, corporate management consultant, believe that the aviation industry is declining under the epidemic, and if employees are laid off by Cathay Pacific, it will be more difficult to transfer to other airlines.
However, Zhang Huimin believes that Cathay Pacific's large-scale layoffs may be an opportunity for employees to reconsider their career plans and work in industries that interest them.
Extended reading: Senior HR expects laid-off employees to be difficult to work "Air service landing is no different from ordinary waiters"
[09:10] Cathay Pacific announced today (21st) morning a restructuring plan to cut 8,500 positions.
Among the 8,500 positions, about 5,300 employees in Hong Kong will be laid off in the next few weeks. Cathay Pacific’s Chief Executive Officer Deng Jianrong sent a letter to employees stating that all feasible measures have been taken to protect the livelihoods of as many employees as possible. He still consumes HK$1.5 billion to HK$2 billion in cash every month. He described the decision in his letter as distressing, thanking "our outstanding employees, and we are facing difficulties together", and he also said that every employee who is about to leave must feel very much at this moment. I apologize for anxiety and distress.
Extended reading: CEO Deng Jianrong: I am very sorry to decide to understand the anxiety and distress of the leaving colleague
Cathay Pacific CEO Deng Jianrong sent a letter to employees on October 21, apologizing for the layoffs.
(Photo by Gong Jiasheng)
[08:28] Cathay Pacific announced its restructuring plan. The first of these is to announce that Dragonair will cease operations from now on. "Hong Kong 01" recalls the history of Dragonair's transformation from Cathay Pacific's competitor to its subordinate.
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
[08:14] 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
[08:06] 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.
[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. Cut 8,500 positions, accounting for 24% of all positions, involving 5,300 Hong Kong-based employees; another 600 non-Hong Kong-based employees may be affected; recruitment freezes, 2600 positions remain 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 cost of the restructuring is approximately 2.2 billion yuan, and it is expected that the restructuring will reduce Cathay Pacific’s monthly cash expenditure by approximately 500 million yuan next year.
[07:52] Cathay Pacific Airways issued a notice this morning, announcing its restructuring plan and cutting 8,500 positions.
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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