Airline industry carnage leaves Hong Kong families struggling but billionaires are sitting pretty

Name: Cathay Pacific Airways announces its largest job cuts in history
Uploaded: 2020-10-26T00:45:12.000Z
Duration: 3 min 43 s
Description: Cathay Pacific Airways announces its largest job cuts in history

Billionaires’ wealth has increased during the pandemic while the aviation industry, which employs tens of millions, is mired in existential crisis

The thousands employed at Hong Kong International Airport and in tourism appear set for even more hardship, unlike the city’s mega rich

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Planes sit grounded on the tarmac at Hong Kong International Airport on March 20. Cathay Pacific and Cathay Dragon are the latest to experience steep job losses as the ongoing pandemic leaves carriers around the world facing severe financial difficulties. Photo: Winson Wong

David Dodwell

Published: 8:45am, 26 Oct 2020Updated: 8:45am, 26 Oct 2020

Remember the old story about how to become a millionaire – start off as a billionaire, and then invest in an airline. As the pandemic recession wreaks havoc through the global aviation, travel and tourism industries, with Cathay Pacific last week joining a long list of floundering airlines worldwide, this adage never has been more chillingly true.

There is a cruel irony that this carnage is occurring as the world’s billionaires have never had it so good. A UBS report shows that the wealth of billionaires increased in all major economies between April last year and July this year.

The US’s top 20 tech billionaires are more than US$250 billion richer over that period, with Jeff Bezos at Amazon US$73 billion richer and both Mark Zuckerberg of Facebook and Elon Musk at Tesla US$45 billion richer. The Hurun report says 257 people became billionaires in China this year, with Alibaba founder Jack Ma 45 per cent richer, with a net worth of US$58.8 billion.

Clearly, none of them have dabbled in the airline industry. I am reminded that Tony Fernandes, who bought AirAsia in 2001 for US$1, must be wistfully mulling those numbers as he closes and writes down his airline operations in Japan, Indonesia, Thailand and elsewhere in an effort to maintain his flagship AirAsia as a going concern.

I wonder at the prospects of Bill Wong, the Hong Kong-based property billionaire. He bravely launched Greater Bay Airlines in Hong Kong just as Cathay Pacific was closing down Cathay Dragon and laying off more than 8,000 staff worldwide.

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Cathay Pacific Airways announces its largest job cuts in history

Travel data group Cirium says 43 airlines have gone bankrupt so far this year, with many more expected to follow in the final quarter. Rob Morris, head of Cirium, said: “If there is any silver lining in all of this, it is that things were so bad that governments had no option but to support.”