SYDNEY (REUTERS,BLOOMBERG) - Hong Kong Airlines, controlled by cash-strapped Chinese conglomerate HNA Group, must shore up its financial position by Dec 7 or risk the suspension or loss of its licence, the Hong Kong government said on Monday (Dec 2).
Hong Kong's Transport and Housing Board (THB) said it met with the city's second-largest airline on Nov 27 and expressed "grave dissatisfaction and deep concern" that the carrier's financial position had not improved.
THB on Monday attached new conditions to the airline's licence, requiring it to raise cash and maintain certain cash levels.
Airport Authority Hong Kong said it was "very concerned about the financial situation" of Hong Kong Airlines and the potential impact on its passengers.
The airline last week announced it was delaying salaries as protests had "severely affected" its finances, already under strain before anti-government demonstrations flared in June. It said revenue dipped significantly in November - a low travel season - and impacted the monthly payroll.
Only cabin crew and overseas employees will receive their November wages on time, while all other Hong Kong-based workers will be paid on Dec 6. It said the one-off salary arrangement will not impact its daily operations.
Hong Kong Airlines cut some operations earlier this month and plans to cancel Los Angeles-bound flights from February.
Other airlines have been affected by the unrest too. Cathay Pacific Airways is one of the most high-profile business casualties, issuing profit warnings and coming under fire from the Chinese government as well as protesters. Singapore Airlines, China Eastern Airlines and Virgin Australia Holdings have all all cut flights to Hong Kong, which is in danger of losing its status as Asia's busiest airport for international traffic.