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Hong Kong Airlines (HKA)

Fragrant Harbour A forum for the large number of pilots (expats and locals) based with the various airlines in Hong Kong. Air Traffic Controllers are also warmly welcomed into the forum.

Hong Kong Airlines (HKA)

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Old 8th Jan 2019, 04:44
  #321 (permalink)  
 
Join Date: Dec 2018
Location: Canada
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Originally Posted by mothy1583 View Post
The opaque machinations of the finance world are all well and good. This is now making headlines and public perception has people questioning whether they should buy tickets well in advance. Right or wrong, justified or not, "sentiment" plays a big part in today's world. HKA will have to work overtime on PR is all.
The question is, is there a PR way going forward to rebuild consumer confidence in HKA?
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Old 8th Jan 2019, 04:44
  #322 (permalink)  
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Originally Posted by unitedabx View Post
Apparently the company is to make a statement on 20th Jan 2019.
Also, fuel companies at HKIA will stop providing credit this week.
Salaries may not be paid on time this month.
Source? Or more rumours and fake news
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Old 8th Jan 2019, 05:50
  #323 (permalink)  
hyg
 
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Originally Posted by SW1 View Post
Source? Or more rumours and fake news
multiple local news just reported yesterday the China Development Bank has injected billions into HKA, and the People's Bank of China (ie Reserve Bank of China) has instructed multiple banks to provide finance to HKA immediately.......yes Granddad just pumped $$ in
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Old 8th Jan 2019, 06:16
  #324 (permalink)  
 
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HKA does not rely on pax from HK for its business. Most pax come from Chinese Travel agencies. If you do a search online, you will find that the Chinese banks just pumped 15 billion US$ and just paid off all the Hainan debt to Airbus and Boeing.

So HKA is not going anywhere soon. Enough money for salaries, and fuel, and everything else as well. They also just paid their bill to CAE in relation to their simulators being delivered, so for a company about to go bust, you don't prioritise the payment of simulators and buildings.

HKA had to open their books to ATLA and show that they are sustainable and profitable. The news on that front is that they have made an operating profit for the last three years and have the cash flow to sustain the operations for 6 months as required.

This is a fact rather than a rumour, as it's a regulatory requirement.

Their problem has been the expansion costs, and investment in buildings, simulators etc. This was taken care of by Hainan, and now it will be taken care of by the Chinese banks. Rumours are that after the Chinese New Year they will announce the sale to a Chinese company. I also have it on good authority that to prove that they are financially sound they are about to announce a Bonus to employees to boost morale. They did make a profit last year, and they are self sustainable operationally. They just over extended themselves with investments and asset purchases.

Anyway what do I know. Perhaps the banks just pumped billions in it on Friday just for the heck of it.
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Old 8th Jan 2019, 07:04
  #325 (permalink)  
 
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Originally Posted by johnpilot View Post
HKA does not rely on pax from HK for its business. Most pax come from Chinese Travel agencies. If you do a search online, you will find that the Chinese banks just pumped 15 billion US$ and just paid off all the Hainan debt to Airbus and Boeing.

So HKA is not going anywhere soon. Enough money for salaries, and fuel, and everything else as well. They also just paid their bill to CAE in relation to their simulators being delivered, so for a company about to go bust, you don't prioritise the payment of simulators and buildings.

HKA had to open their books to ATLA and show that they are sustainable and profitable. The news on that front is that they have made an operating profit for the last three years and have the cash flow to sustain the operations for 6 months as required.

This is a fact rather than a rumour, as it's a regulatory requirement.

Their problem has been the expansion costs, and investment in buildings, simulators etc. This was taken care of by Hainan, and now it will be taken care of by the Chinese banks. Rumours are that after the Chinese New Year they will announce the sale to a Chinese company. I also have it on good authority that to prove that they are financially sound they are about to announce a Bonus to employees to boost morale. They did make a profit last year, and they are self sustainable operationally. They just over extended themselves with investments and asset purchases.

Anyway what do I know. Perhaps the banks just pumped billions in it on Friday just for the heck of it.
Yet CNY bookings have nose dived and those of CX increased 30% since last Friday. The markets don't give a rats arse how much the banks pour into HNA to try and save it. Once the word is out and the creditors smell blood ( or in this case 50 cents on their dollar investment ) the plug will be pulled. The banks can take their money out just as quickly as they put it in. The other big Chineese carriers will not standby and see the young upstart receive effectively government backing thru the back door of local banks. 20th January 2019 is D Day form HKA.
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Old 8th Jan 2019, 08:32
  #326 (permalink)  
 
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Okay United, if it makes you feel better till the 20th, it is going bust on the 20th. Let's see what you have to say on the 21st then, when it is still in business. I don't have a vested interest in the outcome as I am not working for them. A very good friend of mine, a man of immense integrity who is in management though, told me that OPS are normal and that they have paid off the debt with fresh money.

The money was given to them under direct orders of the Chinese government. The airline is a symbol of Chinese prosperity in the old colony. They will integrate it, into another mainland airline, thus it is one of theirs. It cannot fail, while Swire is doing well. Loss of face and all.

As for the objections of the other carriers, all Chinese airlines are effectively state property, as are banks, thus nothing happens unless they have clear orders from the Boss and the party. Maybe you have better information than my friend. He was also baffled by the bail out, as he did not think that they would have survived in the western world.

I would be interested to know though, how you know that their bookings have nosedived and yours gone up by 30%? How would you know that if you work for Cathay? Do you have a software which tracks, forward bookings for all competitor airlines? If you have access to such a software, could you point me in the right direction as it would be a very nice tool to have at my disposal. Usually such commercially sensitive information is difficult to find, so I am sure if you have access to such software I could make some money with it.

TaTa
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Old 8th Jan 2019, 09:09
  #327 (permalink)  
 
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Originally Posted by unitedabx View Post
Yet CNY bookings have nose dived and those of CX increased 30% since last Friday.
I too am very keen to know how you have come across this information? Fake news perhaps? Are you a certain SCMP 'aviation expert' journalist? CNY travel arrangements are not made at the last minute but months in advance..HKA is here to stay. Never underestimate the power of loss of face in Chinese culture. MHKAGA.
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Old 8th Jan 2019, 12:56
  #328 (permalink)  
hyg
 
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Originally Posted by johnpilot View Post
Okay United, if it makes you feel better till the 20th, it is going bust on the 20th. Let's see what you have to say on the 21st then, when it is still in business. I don't have a vested interest in the outcome as I am not working for them. A very good friend of mine, a man of immense integrity who is in management though, told me that OPS are normal and that they have paid off the debt with fresh money.

The money was given to them under direct orders of the Chinese government. The airline is a symbol of Chinese prosperity in the old colony. They will integrate it, into another mainland airline, thus it is one of theirs. It cannot fail, while Swire is doing well. Loss of face and all.

As for the objections of the other carriers, all Chinese airlines are effectively state property, as are banks, thus nothing happens unless they have clear orders from the Boss and the party. Maybe you have better information than my friend. He was also baffled by the bail out, as he did not think that they would have survived in the western world.

I would be interested to know though, how you know that their bookings have nosedived and yours gone up by 30%? How would you know that if you work for Cathay? Do you have a software which tracks, forward bookings for all competitor airlines? If you have access to such a software, could you point me in the right direction as it would be a very nice tool to have at my disposal. Usually such commercially sensitive information is difficult to find, so I am sure if you have access to such software I could make some money with it.

TaTa
what you said seemed to align with what multiple local HK newspaper said about Central Government's order for money to be injected..... Although I would not be surprised if forward booking nose dived given the extensive negative press coverage HKA got within the last few weeks, but all it takes is wide coverage of how Granddaddy just paid off HKA's debt, there'll be much more confidence as it would appear to be moving into the direction as a State owned carrier
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Old 9th Jan 2019, 01:06
  #329 (permalink)  
 
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It’s interesting that a bailout has been “ordered” given that the “mainland government” owns a rather sizable stake in Cathay Pacific through Air China’s holding. But there is room for both and competition is healthy. Having recently flown on a regional flight I was actually very impressed with the service onboard. Very good considering tickets are essentially cheaper than staff travel. That’s the rub of course. The company can’t simultaneously be raking in massive profits and require billions in bailouts. To state otherwise is nonsensical. Clearly there is trouble. The injection of funds is probably just part of the latest round of stimulus. Maybe instilling a little confidence in HNA’s continued ability to succeed worldwide...I’m sure they must be in the “too big to fail” category.
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Old 9th Jan 2019, 04:31
  #330 (permalink)  
 
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Originally Posted by tiredofstupidity View Post
It’s interesting that a bailout has been “ordered” given that the “mainland government” owns a rather sizable stake in Cathay Pacific through Air China’s holding. But there is room for both and competition is healthy. Having recently flown on a regional flight I was actually very impressed with the service onboard. Very good considering tickets are essentially cheaper than staff travel. That’s the rub of course. The company can’t simultaneously be raking in massive profits and require billions in bailouts. To state otherwise is nonsensical. Clearly there is trouble. The injection of funds is probably just part of the latest round of stimulus. Maybe instilling a little confidence in HNA’s continued ability to succeed worldwide...I’m sure they must be in the “too big to fail” category.
Well, if HKA wasn't in some kind of financial trouble, there wouldn't be a need for a government bailout, regardless if it is too big to fail. Beijing may be willing to save HKA, but they might not be happy doing so and would demand some kind of action in return. Hence the departure of the senior management staff at HKA.

Of course, the bailout guarantee might not be 100% fix at this point and some things may still be going in flux, otherwise the HK government won't be preparing contingency for HKA's failure:

https://beta.scmp.com/news/hong-kong/transport/article/2181275/hong-kong-airlines-government-considers-contingency-plan

The HK government may just be doing a "better be prepared", strategy, in case of HKA failure. But if a bailout is 100% certain, they would know and wouldn't be nervous and preparing contingency plans. That suggests a bailout plan is not a done deal at this point.
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Old 9th Jan 2019, 05:15
  #331 (permalink)  
 
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The latest communique from the HKA CEO,

[QUOTE]Letter sent on behalf of our Chairman)

Dear colleagues,

There have been many vicious attacks on Hong Kong Airlines lately. The groundless speculations about Hong Kong Airlines ceasing operation and applying for liquidation from companies like Blue Cross, travel agents and media are untrue and we reserve the right to take legal action against those who deliberately create these rumors.

Hong Kong Airlines has built its success from the hard work that our staff have put in over the years. We have been and are still operating normally. While we have tasted the fruits of our people, we must continue to stay united as a team in times of unprecedented challenges and focus on delivering our best customer service.

Each and every Hong Kong Airlines staff is all heart and cares for the company. Many of you have defended the airline rigorously when approached with difficult questions from people in your network and your efforts are greatly appreciated. As we try our best to address the pressing issues, I strongly urge our staff to remain calm and refrain from making comments on public domains. We must continue to adhere by our brand values and remain professional in the eyes of the public.

I appreciate that many of you worked very hard over the Christmas and New Year holidays. You have united families and also brought festive cheer to many holidaymakers who flew with us during the peak travel season. Between 22 December 2018 and 1 January 2019, Hong Kong Airlines operated more than 1,200 flights and carried over 240,000 passengers. For the coming Chinese New Year holidays, we are expected to operate close to 1,080 flights and fly more than 224,000 passengers between 1 and 10 February 2019. Let’s continue to work as a team and create many memorable experiences for our customers heading home for reunion or spending quality time together as a family during this important Chinese holiday.

I would also like to share with you that Hong Kong Airlines has been named by OAG as the most punctual airline in Asia Pacific and third most punctual in the world for 2018. We have maintained this accolade because of the ongoing efforts and collaborative teamwork led by our operations team. Congratulations and well done to everyone involved.

Let me reiterate once again that Hong Kong Airlines is here to stay. We are proud to be one of Hong Kong’s home carriers and remain committed to sustaining our long term growth. To do that, we must continue to work hard and stay united as one team in the face of adversity. Stay tough and keep our heads high so that we can achieve greater success for Hong Kong Airlines.

Sincerely,

Hou Wei
Chairman

[/QUOTE

where there's smoke, there's fire
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Old 9th Jan 2019, 09:15
  #332 (permalink)  
 
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Originally Posted by HFP View Post
The financing of airlines is big business. Many tricks to get better values, better rates, returns etc.

You can google the Bond and the stories about CBD financing HKAs debt and expansion plans online.

As you can see above, the bond face value went down, which means you can buy it on the market less than what it is worth, by up to 60% less, hence your 550 million has only cost you 220 million. The price of the Bonds tanked, only to recover after CBD Bank put aside 100 Billion RMB (15 Billion US$).

Someone mentioned tricks to affect sales. Tickets are sold 3-6 months in advance, only 10% last minute. The busiest period of the year has been sold months in advance. The load factor will not be affected in the short term.

Since CBD (The government of China) decided to step in and back HKA, they are not going anywhere. I would not be surprised if it was sold to another Chinese Company as an ongoing concern.

Cathay has enough on its plate to worry about taking out a competitor with stupid rumours. The HX Los Angeles, and San Francisco Flights are not really a concern for CX, as it is a drop in the ocean.

Beijing dictates many things anyway, and both companies are owned by Chinese money anyway, and will be completely Chinese at some point.

You may get rebranded and a new logo on your tails because of this, but I cannot see HKA going. These rumours are tricks for much higher and more lucrative financing deals than ticket prices, and load factors.

We just fly planes, in a protected and honest environment hence we are gullible and naive when it comes to financing.
The first sensible thing I've read on this thread for ages. Thank you.
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Old 10th Jan 2019, 00:43
  #333 (permalink)  
 
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latest press release [ https://www.hongkongairlines.com/en_...005567007_269# ]
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Old 11th Jan 2019, 09:37
  #334 (permalink)  
 
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These platitudes were the same kind of commitment that Monarch management put out to employees in 2017. Enough said. Believe what you may, but Ka are recruiting rated FOs , no bonds and a secure future ( relatively speaking)
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Old 11th Jan 2019, 15:56
  #335 (permalink)  
 
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The fact that they put out a notice discounting the rumours is very worrying.

I don’t work for HKA, but over at CPA, when management comes out and says something, the complete opposite ends up being the real story.

Good luck boys and girls. I certainly would bet money in the situation either way. The China that bailed out all carriers in 2008 is very different today.
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Old 11th Jan 2019, 22:14
  #336 (permalink)  
 
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Well, if they do go bust they’ll have the perfect excuse: “all that negative press and media sabotage”!!

For everyone’s sake I hope they pull through this with just a bruised ego..
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Old 12th Jan 2019, 00:28
  #337 (permalink)  
 
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Originally Posted by johnpilot View Post
Okay United, if it makes you feel better till the 20th, it is going bust on the 20th. Let's see what you have to say on the 21st then, when it is still in business. I don't have a vested interest in the outcome as I am not working for them. A very good friend of mine, a man of immense integrity who is in management though, told me that OPS are normal and that they have paid off the debt with fresh money.

The money was given to them under direct orders of the Chinese government. The airline is a symbol of Chinese prosperity in the old colony. They will integrate it, into another mainland airline, thus it is one of theirs. It cannot fail, while Swire is doing well. Loss of face and all.

As for the objections of the other carriers, all Chinese airlines are effectively state property, as are banks, thus nothing happens unless they have clear orders from the Boss and the party. Maybe you have better information than my friend. He was also baffled by the bail out, as he did not think that they would have survived in the western world.

I would be interested to know though, how you know that their bookings have nosedived and yours gone up by 30%? How would you know that if you work for Cathay? Do you have a software which tracks, forward bookings for all competitor airlines? If you have access to such a software, could you point me in the right direction as it would be a very nice tool to have at my disposal. Usually such commercially sensitive information is difficult to find, so I am sure if you have access to such software I could make some money with it.

TaTa
I’m always curious when someone pulls “facts” out if their ass wihout a link and then tells you to do a google search. Here’s flightglobal a month ago on HNA and it isn’t pretty

https://www.flightglobal.com/news/ar...to-201-454198/

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Old 13th Jan 2019, 13:25
  #338 (permalink)  
 
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Hey all, I have a friend wanting to apply for Hong Kong Airlines. Should he apply directly the airline or go through Asia Pacific Aviation Services (hiring agency)?
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Old 13th Jan 2019, 23:23
  #339 (permalink)  
 
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Originally Posted by Hollywood1 View Post
Hey all, I have a friend wanting to apply for Hong Kong Airlines. Should he apply directly the airline or go through Asia Pacific Aviation Services (hiring agency)?
May I suggest you read before posting. No hiring here for a while! Everyone in HKA is hired directly with the airline, no middle men brokers.
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Old 14th Jan 2019, 05:05
  #340 (permalink)  
 
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Originally Posted by PushRed View Post


May I suggest you read before posting. No hiring here for a while! Everyone in HKA is hired directly with the airline, no middle men brokers.
My friend has read this thread and it says Chinese Banks has just pumped in billions of dollars in to HKA. Furthermore, the HKA website is advertising for pilots. My friend has friends who joined through APAS so there are recruitment agencies who handle the recruitment. Can I get an answer from someone who actually works there and knows what's going on?
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