The reorganization plan for Hong Kong Airlines includes new investors, which has made it possible for the airline to emerge with a more promising future.
Hong Kong Airlines is back in the clear and set for expansion after enduring some very significant financial difficulties in recent years. The airline declared yesterday that it has obtained the funding necessary to forward with the implementation of its reorganization plan.
Hong Kong Airlines (HKA) made the announcement that its strategic investment fund has been secured yesterday during a ceremony at the airline’s Hong Kong Training Academy. This paves the way for the financial restructuring, which, according to HKA, will hasten the airline’s business recovery and put it back on a solid development track.
Major comeback by HKA
When it was plausible that the Hong Kong Air Transport Licensing Authority will terminate HKA’s operating license in late 2019, reaching this level of security seemed improbable. The announcement made yesterday, according to HKA, “reaffirms the company’s commitment to contributing to Hong Kong’s aviation industry and the city it has called home for over 16 years.” It also marked a critical turning point in the company’s history.
Senior executives from HKA as well as new investors, significant stakeholders, and business partners attended the cocktail reception. HKA Chairman Hou Wei addressed the crowd and said:
“Thanks to their steadfast support and continued faith in the business, Hong Kong Airlines is poised to start a new chapter with our loyal stakeholders, business partners, and consumers after three tremendously difficult years.
“Business recovery will continue to be our key priority in the coming year, assisted by strategic route planning and fleet restructuring. The business will work to give clients more options and excellent service, enhancing its contribution to Hong Kong being a premier aviation center.
The parent company of China’s Hainan Airlines, the HNA Group, has Hong Kong Airlines as a member. HKA claims to have a fleet of 30 Airbus aircraft on its website, but ch-aviation.com lists 18 of those as being out of service right now. Leaving that aside, according to HKA, the fleet as a whole consists of 12 A320-200s, 10 A330-200s, 6 A330-300s, and 2 A350-900s.
The most frequently used aircraft are Airbus A320s, which may be set up with 174 seats in one class or 144 seats in two classes, eight in business class. At Alice Springs Airport (ASP), which is situated in the optimum storage environment of Australia’s Northern Territory, the A350 aircraft are kept in the desert.
In the reorganization, new investors are included.
The company that would become Hong Kong Airlines had its beginnings as CR Airways in 2001. In 2006, the HNA Group acquired CR Airways, and Hong Kong Airlines was born. The COVID-19 pandemic and political unrest that followed marked the beginning of the country’s problems in 2019. Late last year, the airline reached an agreement on a restructuring strategy to avoid going out of business due to debts of about $6 billion.
The airline has received help from new investors, however the announcement was vague about the size and nature of their investment. In reality, the HKA announcement cited “a representative of the new investors,” not a specific person, as saying to the crowd:
“We are committed to giving Hong Kong Airlines our full support so that it can once again soar to new heights in the Hong Kong and international aviation markets. We’ll also work to reinforce Hong Kong’s monopoly in the aviation industry while actively responding to the growth of the Guangdong-Hong Kong-Macao Greater Bay Area. We are devoted to developing Hong Kong into a global hub.
HKA started operating flights to Fukuoka International Airport earlier this month from Hong Kong International Airport (HKG). The service will run on Monday, Wednesday, Friday, and Sunday each week. Currently, HKA offers flights to five Japanese cities: Fukuoka, Tokyo Narita, Okinawa, Osaka, and Sapporo. With its present network, 25 locations in Asia-Pacific are connected to Hong Kong.
