Hong Kong Airlines is facing an ultimatum placed by the Hong Kong Air Transport Licensing Authority (ATLA) to improve its finances or risk its operating license be suspended.
The airline has been suffering financially for several months now and needs a cash injection to keep operating.
Its difficulties have been compounded by the political unrest still being experienced in Hong Kong
The ATLA issued an alert earlier today, which read: “ATLA met the senior management members of HKA again on November 29, 2019, and heard the representation and explanations made by them about the latest financial position of HKA.
"Having considered the latest financial position of HKA, ATLA was of the view that HKA’s financial position has deteriorated rapidly to such an extent that has severely impacted on HKA’s capability in meeting its obligations as an employer to pay salary and the probability of providing a satisfactory service under its license in respect of continuity and regularity of operation. ATLA found the situation extremely worrying.
“After careful consideration of the financial position of HKA 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 license conditions attached by ATLA, HKA must, by a deadline set, ensure cash injection at a level determined by ATLA (or provide an alternative to the satisfaction of ATLA), and raise and maintain its cash and cash equivalent level as stipulated by ATLA."
In a bid to cut costs, Hong Kong Airlines has recently removed all of its flights to North America discontinuing its scheduled services to Los Angeles from 8 February 2020; and will end its flights to San Francisco even earlier. It will discontinue its direct flights to Vancouver from 12 February 2020.
In a further announcement, the airline said it will discontinue scheduled flights to Ho Chi Minh City, effective from 20 February 2020. As well as a suspension of its Tianjin service from 10 February 2020.
ATLA will announce its decision by December 7, 2019.