HK government tells Hong Kong Airlines it must improve its financial situation

Hong Kong Airlines (HKA) is facing another bout of troubles following a statement by Hong Kong's transport bureau stating that it had concerns over the carrier's financial situation.

The Transport and Housing Bureau of the Hong Kong SAR government, in conjunction with the Civil Aviation Department, met with the airline's management team on 1 November and concluded that the airline had to take measures to protect the interests of passengers and staff.

After reviewing Hong Kong Airlines' financial information and plans for improvement, the Transport and Housing Bureau said in a statement that, "the bureau is of the view that HKA's financial situation has not improved, and that the situation is a matter of concern."

The government said it would continue to closely monitor the airlines' financial situation and consider further actions as appropriate.

Hong Kong Airlines has said that Hong Kong's ongoing citywide protests (which have taken place since June) have impacted its business. The carrier stated that it has already taken measures to remedy its financial predicament. One such example is that the company's senior executives have taken a 20% pay cut and asked employees to take unpaid leave for up to four days a month.

However, this latest report follows a troubling pattern, where for several months, stories have surfaced that bring the stability of Hong Kong Airlines into question.

Most recently, HKA made an announcement yesterday that from 8 February 2020 it would be axing its scheduled service to Los Angeles. The airline had previously cut its San Francisco-bound flights in October, due to "changes in business plans for its North American market." To further reduce costs, HKA will cut its operations by around 6% and would continue to make changes for its flights to Vancouver, Bangkok, Haikou, Hangzhou, Nanjing, Seoul, Bangkok, and several Japanese destinations including Osaka, Okinawa, Sapporo, and Tokyo.

Last week, the Air Licensing Transport Authority, an independent statutory body which has the right to grant, revoke, or suspend licences to carry passengers and cargo - warned HKA to take immediate and concrete steps to effectively improve its finances.