Hong Kong Airlines Operating License Could Be Suspended

Hong Kong Airlines might be just about to become another 2019 tragedy, with rumours that its operating license could be suspended. The government said on Monday the airline needed to find new cash or last-minute investors, or face having its operating license suspended or even revoked.

The Air Transport Licensing Authority (ATLA) said that it met with senior management from the airline on Friday and heard the representation and explanations made by them about the latest financial position of Hong Kong Airlines. ATLA found the airline’s situation “extremely worrying” and believes the airlines financial position has deteriorated rapidly to such an extent that has severely impacted on the airlines capability to meet its obligations as an employer to pay salary and the profitability of providing a satisfactory service under its licence in respect of continuity and regularity of operation. 

Hong Kong Airlines problems are not just limited to the unrest in the city. 

Hong Kong Airlines, which operates a fleet of 44 aircraft to 48 destinations, has been struggling for the last few months. Its problems, however, cannot be entirely blamed on the Hong Kong unrest that is still plaguing the city. The Airline actually has very few connecting passengers and a route network not ideal for cross-continental travel. However, a spokesperson of ATLA continued to add that “after careful consideration of the financial position of the airline at present, ATLA must take immediate and resolute action to prevent further deterioration of HKA’s situation in order to protect public interests”.

In accordance with the two new licence conditions attached by ATLA, Hong Kong Airline must ensure cash injection at a level determined by the ATLA and raise enough cash or cash equivalent level as stipulated by ATLA before a set deadline. With Hong Kong Airlines quickly exhausting all its options to cut costs, in the recent weeks, the carrier has reduced long-haul routes, removed in-flight entertainment and sent a perfectly good Airbus A35o aircraft into storage. 

With ATLA’s decision on the matter to be announced on December 7th 2019, all that is left to ask is will Hong Kong Airlines be able to survive? 


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