Airlines based in Hong Kong have been going through quite a tough phase, as the local unrest and protests have led to slow business for the last couple of months. With the outbreak of coronavirus, things couldn’t had got any worse! Just last week, we had reported on Cathay Pacific having asked employees to take unpaid leaves, in an attempt to save money, and other airlines based in Hong Kong were soon to follow. On Friday, February 7, 2020, Hong Kong Airlines (HKA) stated in a report that it has been forced to slash hundreds of jobs and ask remaining staff to take unpaid leaves as the coronavirus outbreak compounds problems at the already-struggling firm.
After Cathay Pacific, Hong Kong Airlines in turmoil. Image Credits: Forbes
Hong Kong Airlines said in a statement that strict entry and quarantine measures imposed by countries around the world have impacted travel demand in the already affected Hong Kong city, and hence, the airline had to take vigorous measures to mitigate the challenges. The company shall lay off 400 employees, with the remainder asked to take a minimum of two weeks unpaid leave per month or work three days a week from February 17 until the end of June.
In a report to AFP News, Hong Kong Airlines stated:
‘There has never been a more challenging time in Hong Kong Airlines’ history as of now. As uncertainty looms with the evolving nature of this global issue, weak travel demand will likely continue into the summer season and we need to take further action to stay afloat’
As we had earlier reported on the feeble financial state of Hong Kong Airlines, this news is a clear indication of the extremity of trouble HKA is in. In November 2019, HKA announced it would delay salary payments to staff as it struggled to find necessary funds, triggering a warning from regulators that its licence might be at risk. While it managed to keep flying thanks to an injection of funds by the HNA Group, HKA still continues to struggle, now with coronavirus standing as a new impediment.
With no end in sight for distress for airlines based in Hong Kong, we hope HKA holds on and survives this scare. We are following the status of HKA, Cathay Pacific and other Hong Kong based airlines closely. Stay turned for more!