Cathay announces job cuts after posting financial losses

An Asian airline that serves the UAE market is implementing some job cuts that will affect at least 600 personnel in its main headquarters. 

The move, said to be the biggest staff shake-up at the Hong Kong flag carrier in nearly 20 years, followed after the company announced that it had incurred some $74 million in financial losses for 2016, the first since the global recession.

“We have had to make tough but necessary decisions for the future of our business and customers. Changes in people’s travel habits and what they expect from us, evolving competition and a challenging business outlook have created the need for significant change,” said Rupert Hogg, chief executive officer at Cathay Pacific.

The major restructuring will displace 190 employees holding managerial roles and 400 more who are holding non-managerial positions. The staff cuts represent 25 per cent of management and 18 per ccent of non-managerial positions, respectively.

The airline assured, however, that no frontline employees, pilots or cabin crew, will be affected by the staff reduction. However, these employees are expected to "deliver greater efficiencies and productivity improvements."

Cathay Pacific operates a number of flights from Dubai to various destinations in Asia, Australasia, the Americas and the Middle East.

The company said in March that it had been dealing with “intense and increasing competition” from other airlines, particularly those operating direct flights between China and international destinations.

“The operating environment for the Group’s core airline business was difficult in 2016,” the company said.

Airlines from China have been on an expansion mode, consequently eating into Cathay Pacific’s market share. Only recently, Dubai-based Emirates airline introduced a daily flight between Dubai and Cebu City in the Philippines, the same route in which the Asian carrier operates.