Subject category:
Strategy and General Management
Originally published in:
2019
Abstract
In 2018, Cathay Pacific Airways Ltd experienced two consecutive years of operating loss. One of the main reasons for the struggling financial performance was a financial loss from fuel hedges. However, in addition to financial loss from hedging, the competitive dynamics were also changing in the airline industry. The increased competition has led the airlines to the price competition, which makes it difficult to be profitable. Furthermore, the rise of low-cost carriers (LCCs) also create a challenging operating environment. The company executed reorganization plan for successful turnaround. The plan will include improving efficiency in operations, a greater focus on customers, and strengthening competitive position within the industry. CEO Hogg was facing the challenges of how to make the company’s turnaround successful. How Cathay Pacific Airways could overcome the losses and gain new strategic momentum?
Teaching and learning
This item is suitable for undergraduate and postgraduate courses.Time period
The events covered by this case took place in 2018.Geographical setting
Region:
Asia
Country:
Hong Kong
Featured company
Cathay Pacific Airways
Employees:
10000+
Turnover:
HKD 110 billion approx
Type:
Public company
Industry:
Airline
Subject category:
Strategy and General Management
Originally published in:
2019
Length: 8 pages
Data source: Published sources
About
Abstract
In 2018, Cathay Pacific Airways Ltd experienced two consecutive years of operating loss. One of the main reasons for the struggling financial performance was a financial loss from fuel hedges. However, in addition to financial loss from hedging, the competitive dynamics were also changing in the airline industry. The increased competition has led the airlines to the price competition, which makes it difficult to be profitable. Furthermore, the rise of low-cost carriers (LCCs) also create a challenging operating environment. The company executed reorganization plan for successful turnaround. The plan will include improving efficiency in operations, a greater focus on customers, and strengthening competitive position within the industry. CEO Hogg was facing the challenges of how to make the company’s turnaround successful. How Cathay Pacific Airways could overcome the losses and gain new strategic momentum?
Teaching and learning
This item is suitable for undergraduate and postgraduate courses.Settings
Time period
The events covered by this case took place in 2018.Geographical setting
Region:
Asia
Country:
Hong Kong
Featured company
Cathay Pacific Airways
Employees:
10000+
Turnover:
HKD 110 billion approx
Type:
Public company
Industry:
Airline
Related
Subject category:
Strategy and General Management
Originally published in:
2019
Length: 8 pages
Data source: Published sources