Thursday , June 1 2023

Hong Kong carrier Cathay Pacific announces shock resignation of CEO Rupert Hogg, East Asia News & Top Stories


HONG KONG (AFP, REUTERS, BLOOMBERG) – Cathay Pacific announced the shock resignation of its CEO Rupert Hogh on Friday (August 16th), days after Hong Kong carrier was listed by Beijing as some officials backed protests against democracy in the city.

In a statement issued on the Hong Kong Stock Exchange on Friday, Cathay Pacific said Mr Hog had resigned "to take responsibility as a company leader in the wake of recent events."

He was replaced by Mr August Tang, a veteran of the Swire Group's conglomerate, a major shareholder of the carrier.

Cathay also said that Mr Paul Loo has resigned as chief customer and sales officer and will be replaced by Mr Ronald Lam, Head of Hong Kong Express Low Cost.

The shock exit comes after one of the worst weeks in Cathay's recent history, the airline has become the most visible corporate casualty of Hong Kong's political unrest, with demonstrations against the extradition bill turning into a full-scale impact against China's capture of the city.

Cathay is Hong Kong's largest airline and its airport, which was shut down earlier this week by protesters, is the carrier's hub.

After Cathay officials engaged in strikes and protests, China's aviation regulator has amassed a number of airline curbs that are increasingly dependent on continental traffic. Chinese state-owned companies have begun boycotting Cathay, telling workers not to fly with the carrier. The company was also excited by the country's largest bank, sending its shares to a 10-year low on Tuesday.

"This is the right step to rebuild relations with China," said K. Aidz, an analyst at UOB Kay Hian Pte in Singapore. "Someone takes responsibility – they recognize the importance of China and its shareholders."

The resignation was first reported by Chinese state television CCTV, which said Mr Hog had left without telling where the information was.

Mr Hogg took over the helm of the 72-year-old carrier just over two years ago, charged with one of the toughest jobs in Asian commercial aviation. He was previously CEO of Swire Group, a Hong Kong conglomerate, and Cathay's largest shareholder.

Cathay considers state-owned Air China the second largest investor, with a stake of about 30%.

After being the dominant player in the Asian first-class air travel market with several serious rivals, Cathay introduced Mr Hog in 2017 after the airline reported its first loss in eight years. Challenges include increased competition from budget carriers and deep-pocketed Chinese carriers. Asian invasions by Middle Eastern competitors such as Emirates Airline and Etihad Airways aimed at business travelers have also made an impact.

By cutting costs, including hundreds of job cuts, Mr. Hog was able to revive the airline's profit potential. This year, he leads the takeover of Hong Kong's only low-cost airline to enter the market without unnecessary, after resisting a similar move for more than a decade to focus on premium services.

Mr. Hogg joined the Swire Group in 1986 and continued to rise overseas in Southeast Asia and the United Kingdom before being named Chief Operating Officer of Cathay in 2014. As part of the Senior Management Team, Hog helped to come up with a restructuring plan. the company is still performing.

The airline is fully committed to Hong Kong on the principle of One-to-Two Systems, Cathay said in a statement on Friday. "The company is confident that Hong Kong will have a great future."

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