If the group Cathay is usually the first name that springs to mind when one thinks of air transport in Hong Kong - the company carries 75% of the territory's passengers - but another carrier has managed to make a name for itself in the metropolis over the last decade: Hong Kong Airlines. The company, which was founded in 2006, is a subsidiary of a major Chinese conglomerate, HNAthe parent company of Hainan Airlines. HNA has a 45% stake in the airline. After serving London Gatwick for a few months in 2012, Hong Kong Airlines finally resumed its intercontinental expansion in 2017, launching flights to Australia, Auckland in New Zealand, Vancouver and the United States (Los Angeles), San Francisco and Saipan) and to Moscow.
Since mid-2018 financial problems have seriously affected the economic equilibrium of Hong Kong Airlines. In a situation of intense competition in Hong Kong, the carrier is accumulating losses and its shareholder, HNA, is refusing to recapitalise the carrier. This situation is reminiscent of the fate of another company in which HNA owned 49% of the capital, Aigle Azur... In March, HNA sold Cathay Pacific its other Hong Kong airline subsidiary, the low-cost Hong Kong Express. Cathay is due to buy back all the shares in HK Express by 31 December 2019.
At the beginning of the year, Hong Kong Airlines was criticised by the Air Transport Licensing Authority (ATLA) for its inability to pay aircraft leasing arrears. In March, Hong Kong Airlines also announced that it would not be taking on three new Airbus A350-900s and that it also wanted to get rid of 10 Airbus A330-200s.
The end of the long-haul network
The company has since fallen victim to the political crisis in Hong Kong whose violence pushed the city into recession and caused air traffic to fall by 12.5% in October, following a 3.5% drop in September. Three million aircraft seats have been eliminated in recent months...
Hong Kong Airlines has thus abandoned several short-haul routes such as Fuzhou in China, Miyazaki in Japan and Phnom Penh in Cambodia. Next February, the carrier will also close its routes to Ho Chi Minh City and Tianjin.
The airline indicated that it would have to prune its network by ceasing all its long-haul routes. Next February, Hong Kong Airlines will stop its flights to Los Angeles and Vancouver. The airline's management has indicated that it will be refocusing on regional traffic, while the fleet will be reduced to around twenty aircraft. A total of 15% of the airline's capacity will disappear, leaving a network of 24 cities.
Will this be enough to save the carrier from possible liquidation? The company probably received a financial injection from HNA on Tuesday, the latter having benefited from a $570 million loan from Chinese banks. The injection was necessary because ATLA had announced that it would suspend the operating licence on Thursday if nothing was done. According to the chairman of Hong Kong Airlines, the money received is only a first step, with further funds planned to enable Hong Kong Airlines to resume more regular operations. According to the South China Morning Post, at least a quarter of the company's aircraft are grounded. If Hong Kong Airlines goes bankrupt, it will be the biggest economic victim of the political crisis of the former British colony.
Hong Kong Airlines fleet :
| Aircraft types | Number of devices |
| A320 | 12 |
| A330-200 | 11 |
| A330-300 | 10 |
| A350-900 | 6 |
| Total | 39 |
