(Reuters) – Hong Kong’s Cathay Pacific Airways Ltd 0293.HK will cut around 6,000 jobs or 18% of its workforce, and axe regional brand Cathay Dragon to help it weather the coronavirus pandemic, the South China Morning Post reported on Tuesday, citing sources.
The airline said in June it was reviewing its strategy in light of the travel downturn, with “tough decisions” to be announced during the fourth quarter and analysts expected it would announce major job cuts.
In June, the Hong Kong government led a $5 billion rescue package for the airline, which has been burning through around HK$1.5 billion to HK$2 billion of cash a month.
The South China Morning Post said the airline was expected to announce the job cuts on Wednesday, adding the figure had been reduced from 8,000 layoffs after government intervention.
The newspaper, citing sources, said the Cathay Dragon brand, would be sacrificed but staff and resources of the two airlines would be merged. Cathay did not respond immediately to a request for comment.
The airline last month said it would not apply for further government employment subsidies for its main business units, freeing up its ability to make major job cuts at Cathay Pacific and Cathay Dragon, though not at budget carrier HK Express.
Singapore Airlines Ltd SIAL.SI has announced plans to cut around 20% of positions, while Australia’s Qantas Airways Ltd QAN.AX has said it will cut nearly 30% of its pre-pandemic staff, but Cathay had until now refrained from major job cuts.
The airline has sent around 40% of its passenger fleet to less humid locations outside Hong Kong for storage.