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Exclusive | Cathay Pacific restructuring will target noncore businesses and job cuts loom in bid to survive pandemic, CEO hints
- In wide-ranging interview with the Post, Augustus Tang notes need for quick, decisive action in airline’s restructuring
- Analysts suggest catering and airport services operations could be under threat
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Cathay Pacific Airways will soon move to rationalise its operations as part of the airline’s restructuring to survive the coronavirus pandemic, and one of the first targets will be its noncore businesses, its CEO said in an interview with the Post.
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In the biggest hint yet that redundancies were imminent, Augustus Tang Kin-wing said the airline’s overall cost competitiveness and efficiency had to match its rivals in what he described as “the new travel industry” already in the throes of shedding thousands of jobs.
The group’s two main airlines, Cathay Pacific and Cathay Dragon, declined to apply for a further round of government wage subsidies earlier this month. Now unfettered by the condition they retain jobs to enjoy those grants, mass lay-offs could happen as early as next month.
“We will have to do some rationalisation of the routes, and right-sizing the airline is inevitable,” Tang said. “Because of the state of the industry, there is a need for us to take decisive action rapidly.”
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Tang said survival depended on whether the carrier could adapt to a post-pandemic era, where fewer people would fly for some years to come, as well as a recovery dictated by the availability of a vaccine.
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