Cathay Pacific Airways Ltd. plans to cut jobs at its overseas operations as part of the company’s three-year restructuring efforts, South China Morning Post reported.
The airline’s plan will involve the consolidation of its overseas sales, marketing, cargo and airport-based operations, the newspaper said, citing a source it didn’t identify. Cathay, which has about 7,600 employees based in 100 locations outside Hong Kong, declined to reveal how many would be affected or which markets they were from, according to the report.
Following the redesign of Cathay’s head office structure, it’s reorganizing other teams to enable quicker and better informed decisions to be made, the carrier said in an emailed response to questions. An internal memo has been shared with employees on the restructuring, and this work will continue over the coming months, Cathay said.
The aim is to establish a structure that “modernizes our ways of working and thinking, makes us leaner and more agile,” Cathay said, without referring to any job cuts.
Chief Executive Officer Rupert Hogg, appointed in May 2017, is trying to turn around the airline’s fortunes as it faces growing competition from budget carriers and rivals in neighboring China. The CEO cut 600 jobs in Hong Kong last year and has taken delivery of new aircraft to help Cathay become more competitive.
As part of the restructuring plan, the airline will reduce costs by more than HK$4 billion ($510 million) over three years. About HK$1 billion is expected to come from scaling back pilots’ benefits and allowances, the newspaper said. Cathay has yet to reach any agreements with its pilots.
Increased earnings from associates including Air China Ltd., in which Cathay owns 18 percent, helped the Hong Kong carrier post a net income of HK$792 million in the second half of 2017. Still, competition from Chinese carriers and fuel-hedging losses resulted in a full-year net loss of HK$1.26 billion. — Bloomberg