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Cathay Pacific Laying Off Hundreds of Staff
Cathay Pacific Laying Off Hundreds of Staff. Hong Kong airline Cathay Pacific said it was firing 600 employees on a "hard but necessary" attempt to repair the damage to its bottom line. It is the company's largest round of job cuts in 20 years.In an attempt to remain a competitive force in the airline industry, Cathay Pacific will reduce 600 jobs at its headquarters in Hong Kong.
While front-line staff, such as pilots and cabin crew, are not affected, the company has called for greater efficiency. Instead, the airline said it plans to hit about 190 managers, or a quarter of all the company's management jobs. It is also eliminating the jobs of 400 non-managerial employees.
"We have had to make difficult but necessary decisions for the future of our business and our customers," said CEO Rupert Hogg.
"The changes in people's travel habits and what they expect from us, the evolution of competition and a challenging business perspective have created the need for a significant change."
Rationalization in progress
Aviation analyst Corrine Png said the company was moving "in the right direction" as it seemed to transform the business and improve cost competitiveness.
In March, the company posted its first annual net loss in eight years, citing intense competition as low-cost airlines, particularly mainland China, consumed their market share.
He pledged at that time to cut costs by 30 percent after his net loss of USD 74 million in 2016 invested a profit of USD 773 million in the previous year.
"Job cuts are obviously the most effective short-term measure, but Cathay's problem does not come from within, it's growing competition from outside full-service pairs in the continent and Middle East to budget carriers," Yu Zhanfu of Roland Berger Strategy The consultants were told.
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