Hong Kong’s third-largest carrier, Hong Kong Airlines, is reportedly looking at grounding its fleet of Airbus A320s to focus on cargo operations. According to a new plan, the airline will deploy eight of its 21 Airbus A330s on cargo routes as it continues to struggle under the ongoing impact of the global pandemic.
While the airline hasn’t taken any major steps yet, according to the South China Morning Post, it is considering grounding all operations except for a few cargo routes. Hong Kong Airlines is looking to take drastic measures to ensure the airline’s survival as the pandemic drags on.
Like many airlines, Hong Kong air has been struggling to deal with the financial impact of the COVID-19 pandemic. As a result, the airline’s cash flow has become a major problem, and so, with passenger demand still low, the airline may choose to focus on cargo operations.
As well as slashing passenger operations, the airline will ground most of its fleet and likely lay off more staff. The airline cut jobs last year, but reports suggest more staff may lose their jobs as passenger operations come to a halt.
Grounding the entire fleet
The airline currently operates a fleet of 34 aircraft. This includes 12 A320s, one A350XWB, and 21 A330s. Under the new plans, the entire fleet would be grounded. The exception would be eight A330s which would be used to prioritize cargo operations over passengers. Although this sounds dramatic, the airline parked 24 aircraft during the height of the pandemic.
The new plan would be a significant step back for the airline, just as other airlines are looking to move forward into recovery. The airline has been struggling financially before last year’s challenges placed additional stress on the airline. With so few aircraft in the air, the airline cannot afford to keep cabin crew and pilots on the payroll. As such, the chances of even more layoffs coming to rather high.
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Focus on cargo
Although the plan is not yet in motion, the airline desperately needs to make changes. The decision to focus on cargo operations is one that several other airlines have fallen back recently. The airline asked the Hong Kong government for aid, but many suspect the airline could still close down.
Hong Kong recently relaxed rules for cargo pilots meaning Hong Kong Airlines won’t be the only airline looking to step up cargo operations. Focussing on cargo operations in the short term could be successful for Hong Kong airlines. However, if it does furlough more staff, it could lose government funding. The airline is already in trouble for miscalculating the wage subsidy.
While cargo has been a good source of revenue for many airlines over the past year, it may not be enough to save Hong Kong Airlines. Moreover, if the airline loses government funding and cuts jobs, it won’t be an easy position to come back from.
What do you think of Hong Kong Airlines’ plan? Is focusing on cargo operations a good move? Let us know your thoughts in the comments section.