Hong Kong Airlines (HKA), which has been plagued by fiscal, is to completely withdraw from the North American market, following a latest round of capacity cuts. It will axe Vancouver — its last North American point — from 12 February next year. This follows the suspension of flights to Los Angeles days earlier on 8 February, and an earlier withdrawal from serving San Francisco. Cirium schedules data indicates the carrier serves Vancouver twice weekly with A350-900s between both cities. HKA will also suspend Tianjin from 10 February, and Ho Chi Minh City from 20 February. The move to cut capacity follows a network strategy review under which the airline will focus on "priority routes" in its network. "While the airline has already reduced its capacity and flights in the coming months, weak travel demand continues to affect its business and revenue," says HKA, attributing its woes to the "challenging business environment" caused by the ongoing unrest in its home city. Earlier this month, the carrier said it was cutting capacity by 6% as its financial problems mounted. It also adjusted frequencies to nine other points in its network, including Osaka, Okinawa, Tokyo and Bangkok. Separately, the South China Morning Post is reporting that Hong Kong's Air Transport Licensing Authority (ATLA) has met with HKA again, to discuss the airline's financial situation. ATLA, which has the authority to revoke an airline's licence on deeming it to have failed to meet applicable regulations, confirmed FlightGlobal's queries that the meeting took place. “[The authority] will make an announcement as soon as possible,” it adds. The meeting was called for HKA’s management to “report the airline’s latest financial situation in detail”. It also comes amid reports that the airline had failed to pay the November salaries of some of its staff, delaying payment till the first week of December. To this, the ATLA says: “[We are] extremely concerned about the inability of [HKA] to make salary payment to some of its staff as scheduled for November 2019.” “[We] will evaluate the information and explanation to be provided by HKA, and will consider whether there is a need to take appropriate action(s),” it adds. A month ago, ATLA said HKA's financial state "showed no sign of improvement", and that it has been monitoring the situation closely. The two sides last met on 25 October, after which ATLA laid out the ultimatum for the airline to shape up or face consequences. Story updated with ATLA's statement.

Source: FlightGlobal

South Africa's government is to undertake an extensive restructuring of South African Airways, insisting that it has run out of alternative strategies for the troubled flag-carrier. The country's department of public enterprises says the loss-making airline has been through "difficult challenges" in the past few years and particularly during the last few weeks – which have included industrial action from two unions. These strikes caused "immense damage" to the carrier's reputation and operations, and contributed to a deterioration in its financial position, the department adds. "SAA, therefore, cannot continue in its current form," it states. "The airline group will now go through a radical restructuring process which will ensure its financial and operational sustainability. "There is no other way forward." The department has not detailed the nature or full extent of the overhaul but says "various options" are being considered. But it says that, over the past few days, there have been "intense discussions" with the airline's lenders to secure funds necessary to cover an operational and structural transition over the coming months. "The [government] is committed to a viable, sustainable, profitable national airline," adds the department. "It is our collective responsibility as South Africans to support SAA in its efforts to restore sales confidence among its customer base and rebuild revenues in the shortest possible time." SAA has been attempting to implement a long-term turnaround plan, and has received several packages of government financial support to aid with liquidity. But the carrier has continued to turn in substantial losses and it has been hampered further by turmoil in its senior management, with multiple changes of chief executive over the last decade. "SAA is determined to remain open for business," says the department. "Management is also committed to ensure financial sustainability going forward." It adds that the board intends to take "bold initiatives" to increase SAA's market share and "intensify" marketing campaigns in an effort to rebuild confidence in the ailing carrier.

Source: FlightGlobal

Czech carrier Smartwings is to wet-lease four Boeing 737-800s to the Middle Eastern operator Flydubai, to help offset a capacity loss from the 737 Max grounding. Flydubai states that it has finalised an agreement to lease the four -800s from Smartwings for the period from 14 December this year to 25 January 2020. The jets will provide additional capacity during the busy seasonal travel period, says Flydubai, which has 40 737-800s – as well as 14 737 Max jets grounded since March. Chief executive Ghaith Al Ghaith says the disruption caused by the grounding has been "significant", forcing a 30% cut in its schedule. "These four additional aircraft will enable more passengers to have more options to travel during the holiday season," he adds. The all-economy jets will operate to destinations including Bahrain, Kuwait, Karachi and Muscat.

Source: FlightGlobal