Cathay Pacific Airways plans to begin laying off about 800 of its ground staff towards the end of this month, as the airline's fortunes continue to nose dive and the Hong Kong-based carrier faces the possibility of recording a first-half loss in 1998.

The planned 800 redundancies will affect ground staff across the airline's network, including those at the level of senior general manager and downward. The cuts are in addition to those made in 1997. Close to 550 positions will also be contracted out this month with the carrier's move to the new Hong Kong airport at Chek Lap Kok.

It is understood that further retrenchments are in the pipeline, as the airline's problems continue to worsen. A recent outbreak of fatal "bird-flu" influenza in Hong Kong has served partially to undermine Cathay's recent two-for-one fare discount, which boosted bookings by 80,000 passengers.

Cathay's passenger revenue slumped by another 19% in November, compared to 1996 figures, with no sign of any turnaround. A new research report by Salomon Smith Barney is warning that it would take only a 4% decline in its latest revised forecast for the airline to slide into the red in the first half of 1998.

Source: Flight International