SYDNEY: Hong Kong’s Cathay Pacific Airways Ltd 0293.HK said on Friday it would not apply for further government employment subsidies for its main business units, freeing up its ability to make major job cuts at Cathay Pacific and Cathay Dragon.
It has, however, applied for the support for budget carrier HK Express, Air Hong Kong, Cargo Terminal, Hong Kong Airport Service and Cathay Pacific Catering Services, the airline said in a statement. That financial support protects jobs from September to November, according to the government website.
Cathay, which received a $5 billion rescue package led by the Hong Kong government, has so far refrained from large-scale job cuts but has warned it is reviewing all aspects of its business model with the results expected in the fourth quarter.
Cathay and its units had around 27,000 employees globally at the end of 2019, according to its annual report. So far the group has cut jobs of around 400 overseas cabin crew and offered voluntary early retirement to pilots.
“It is inevitable we will need to right-size our airlines to address the reduced travel market,” Cathay General Manager Corporate Affairs Andy Wong said in the statement.
“We continue to make decisions based on the long-term interests of the company and the Hong Kong aviation hub, to protect our future and as many people as possible.”
Several employees have told Reuters on condition of anonymity that they are bracing for major job losses in line with those seen at other airlines in the region.
Rival Singapore Airlines Ltd SIAL.SI announced on Thursday plans to cut around 20% of positions, while Australia’s Qantas Airways Ltd QAN.AX has said it will cut nearly 30% of its pre-pandemic staff.
Cathay, like Singapore Airlines, lacks a domestic market at a time when most international borders remain closed.
The Hong Kong airline said last month it expected passenger capacity to operate at around 8% of normal in August and September, though demand is strong in its cargo business.
Source: Reuters, Reporting by Jamie Freed; Editing by Jacqueline Wong and Muralikumar Anantharaman