Cathay Pacific to cut 8,000 jobs, Dragonair to stop operations!
athay Pacific Group is to close its Asian subsidiary, Cathay Dragon.
Another 8,500 jobs, or 24 per cent of the total, will be cut, including 5,300 staff based in Hong Kong;Another 600 non-resident staff could be affected;Recruitment freeze, 2,600 positions remain vacant.
This is one of the latest steps the company has taken to address the continuing impact of the coronavirus crisis.
The Hong Kong-based airline group said the restructuring would allow it to "secure its future".The announcement comes a day after the airline group revealed that it expects to operate at less than half of its total capacity by 2021.
Augustus Tang, Cathay Pacific chief executive, said: "The global outbreak continues to have a devastating impact on the aviation industry and the hard truth is that we have to fundamentally restructure the group in order to survive."
Cathay Pacific Dragonair will cease operations immediately.The group said it would seek regulatory approval to allow its other airlines, Cathay Pacific and HK Express, to operate most of The carrier's routes.
The airline group said executive pay cuts would last until 2021 and would introduce a third round of voluntary special leave programmes for non-flying employees in the first half of next year.There will be no raise in 2021.
"So far, we have taken every possible action to avoid job losses."We have reduced capacity to meet demand, delayed new aircraft deliveries, suspended unnecessary expenses, implemented a hiring freeze, executive pay cuts and two special rounds of vacation."
"But despite these efforts, we are still burning HK $1.5bn - HK $2bn a month in cash."This is not sustainable."The adjustment announced today will reduce cash expenditure by about HK $500 million per month," he added.
Hong Kong's Cathay Pacific group accounts for 57% of passenger and 41% of cargo traffic at Hong Kong International Airport, according to the data.Cathay carried 83.2 per cent fewer passengers and 33.9 per cent fewer goods in the first nine months of this year, and the group expects passenger capacity to remain below 50 per cent of normal levels next year.