Should VA be worried by the potential collapse of Hong Kong Airlines?

[jase05]

Have just been in HKG Club Altus this evening, ahead of the HKG-SYD in J. Nice lounge, good showers, sleep pods and massage chairs. Also found HX to be good for internal China flights. They gave us bulkhead exits at no charge. Hope they keep it together.

Agreed.
Would be sad to see them disappear for those reasons you have mentioned. We have had a couple of really good flights with HX to TPE and BKK and found the staff pleasant and the service good. Nice lounge with great showers. My wife especially loved the “Hong Kong Sky” coughtails

 

[ermen]

much ado about nothing
HK airlines not collapsing in the next month

 

[dajop]

Agreed that VA wouldn't be that interested. I think it's tough to compete with QF and CX on this route ....

This + one of the reasons for VA flying to HKG is feed to/from HX... so even current services could be less viable if HX were to disappear (not that it is necessarily likely that they will).

 

[pauly7]

At the end of the day VA don’t have much sway over any of their struggling parents, I suspect they may be more worried about Etihad.

What could hurt them and perhaps more likely is if they go cap in hand for more cash (again) and the wells have dried up as opposed to their owners collapsing completely.

 

[yohy?!]

HK Gov preparing contingency plans in case HX winds up during Chinese new year.

Hong Kong Airlines: government considers contingency plan for possible Lunar New Year shutdown | South China Morning Post

They have received a reprieve on the huge load of expiring debt this month with a bailout but these types of headlines may still finish them off if people stop booking.

 

[wannabeinvestmentbanker]

Nice find Yohy. Will be very interesting to see how this plays out. Given lack of insurance coverage, I can't see how any rational purchaser would make a booking with them.

 

[HS-TQE]

At the end of the day VA don’t have much sway over any of their struggling parents, I suspect they may be more worried about Etihad.

What could hurt them and perhaps more likely is if they go cap in hand for more cash (again) and the wells have dried up as opposed to their owners collapsing completely.

Also to add, with the EY/EK takeover rumours still going. There are eyes watching whether EK would sell EY's 9W/VA stakes if the take-over goes through, which most watchers are predicting that EK would sell those stakes if they take over EY.

SQ aren't likely to do anything to help VA either considering they've blamed VA for a recent profit downturn in their last quarterly report.

IMO, people should stop expecting "SQ to save VA" considering they've been "hands-off" with VA for most of the time they had their stake (except for the cash injections during and after the capacity war ended). Every year some article pops up about "SQ interested in a takeover/further stake in VA" and in all cases they turned out to be fizzers/false.

 

[33kft]

Haven't SQ got enough airline stakes to worry about (Singapore, Silkair, Tiger, Scoot and Vistara) without needing an increased stake in an Australian airline on that list? I can't imagine that things stay efficient as you keep adding retail airlines (and as an extension, regulated entities) to the list

 

[AIRwin]

Haven't SQ got enough airline stakes to worry about (Singapore, Silkair, Tiger, Scoot and Vistara) without needing an increased stake in an Australian airline on that list?

Tiger has merged with Scoot, and Silkair will be merged into SQ, so Virgin will fit right in with the other V...

 

[drron]

Things now looking a lot worse.
All long haul flights to be discontinued.
Cuts to China routes.
Staff not paid in November.
Now cutting IFE.

Hong Kong Airlines Announces The End Of Long Haul Flights

simpleflying.com

Hong Kong Airlines Suspends Inflight Entertainment

Hong Kong Airlines will be turning off in-flight entertainment as of December 1, 2019, as they struggle to pay their bills. Here's what we know.

onemileatatime.com

Plus rumours that the Air Transport Licensing Authority are considering revoking their licence.

Hong Kong Airlines in crisis talks as existence hangs in balance

Air Transport Licensing Authority says carrier has been in deep financial trouble for ‘long period of time’ as it hints at taking action, and officials could revoke licence or demand it restructure as condition of continuing to exist.

www.scmp.com

 

[HS-TQE]

One of the few 'opportunities' out of a potential HX collapse, it may open up the chance for VA and VS to negotiate more friendly landing/takeoff slots to reduce the "transit" time on the westbound (SYD-HKG-LHR) Kangaroo Route as part of the VA/VS JV.

Should HX collapse, it will open up more takeoff/landing slots.

 

[HS-TQE]

HK Aviation Authority (ATLA) is likely set to withdraw HX's AOC on the back of their detoriorating financial situation. They've just issued the "Show Cause" letter to HX.

Air Transport Licensing Authority attaches new licence conditions to Hong Kong Airlines Limited

The following is issued on behalf of the Air Transport Licensing Authority (ATLA): In the light of the ongoing financial problems of Hong Kong Airlines Limited (HKA), ATLA...

www.info.gov.hk

Looks like VA may have to rely on O&D, the VS Kangaroo Route JV and the NH interlines for traffic on the SYD-HKG route.

 

[mlob]

We have 4 business seats booked Jan 1. Hong Kong to Osaka.

 

[drron]

The HK Transport Authority has clarified their message.the licence will not be reviewed in 5 days but they have 5 days to come up with a survival plan.

But mlob keep checking your flight regularly because they have been progressively cutting flights.

Hong Kong Airlines has a week to save its licence

Regulators gave Hong Kong’s third-largest carrier a week to improve its financial situation or risk losing its licence.

www.aljazeera.com

HNA Receives $568m Loan. Will It Go To Hong Kong Airlines?

Hong Kong Airlines must receive a cash injection at an undisclosed level set by ATLA, and then raise and maintain cash and cash equivalents, also at an undisclosed level.

www.forbes.com

 

[Ausbt]

I'm booked SYD-HKG-NRT on January 10, so worrying for sure.

 

[kamchatsky]

I'm booked SYD-HKG-NRT on January 10, so worrying for sure.

To be honest I think the chance of HX surviving is low so definitely look for alternate plans if you can.

 

[drron]

Surviving for at least a little while longer as a cash injection has appeared.

Hong Kong Airlines Gets Cash Injection

Hong Kong Airlines has received a new cash injection, just ahead of a deadline where they could have seen their license revoked. Here's what we know.

onemileatatime.com

 

[drron]

Or maybe not surviving.

Airport Authority Of Hong Kong Impounds Seven Hongkong Airlines Jets Over Unpaid Fees

Seven Hongkong Airlines Aircraft Impounded Over Unpaid Fees.

loyaltylobby.com

 

[clipped_wings]

My guess is that the potential exodus, compounded by a lack of future bookings from worried customers (and rightly so), will inflame this sad scenario even further.