Cathay Pacific cuts hundreds of jobs in major shake-up

Cathay Pacific cuts hundreds of jobs in major shake-up

Cathay Pacific cuts hundreds of jobs in major shake-up

Cathay Pacific Airways confirmed on Monday that it will lay off nearly 600 employees from its head office, in the biggest round of job cuts by Hong Kongs flag carrier in 20 years.

The company as a whole lost HK$575m ($106.5m) in the year, with better performances in other areas of the business - such as catering and its shareholding in Air China - offsetting the poor results from the airline.

The cuts are the first step in a three-year program announced earlier this year aimed at turning around losses at the beleaguered airline, the newspaper added.

It was Cathay Pacific's first annual loss since 2008.

Mr Hogg cited increasing competition and a challenging business outlook for what he called "tough but necessary decisions for the future of our business and our customers".

Cathay shares rose 2.3 percent in early trade Monday.

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The job cuts will go some way to reaching a 30 per cent cost reduction target at the airline's Cathay City headquarters in Hong Kong, that was specified under the programme.

The airline - comprising Cathay Pacific and Cathay Dragon - has lost $3 billion Hong Kong dollars in the past year.

"We have to see global capacity additions come down and airlines would have to mothball aircraft, instead of trying to still utilise and cover some of the costs associated with that". As many as 800 job cuts were initially being considered as late as last week, they said.

The appointment of Hogg, who was promoted from chief operating officer to chief executive this month, underscores the urgent restructuring task facing the airline amid aggressive expansions by rivals, analysts have said.

The Oneworld carrier says in a statement that around 190 managerial roles will be cut, representing roughly one quarter of its management ranks.

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