Seven Hong Kong Airlines Airplanes Seized

Things keep looking worse and worse for Hong Kong Airlines. After suffering major financial struggles, HKA was given until December 7th to find investors, or risk losing its operating license. Fortunately, they secured cash by the deadline, and for a moment, a glimmer of hope shined through for the ailing carrier. However, things have seemed to taken another unfortunate turn as Airport Authority Hong Kong (AAHK) has used section 40 of the Airport Authority Ordinance to take control of seven of the airline’s aircraft.

What’s the Reason?

The Civil Aviation Department explained AAHK’s decision in a statement, “AAHK’s detention action will help protect the financial interests of both AAHK and the government.” The aircraft in question have been sitting at the city’s airport between 56 and 318 days and are either owned or leased by HKA. Hong Kong airport charges about $12 for every 15 minutes a carrier parks its aircraft on the airport, which can rack up a significant debt if they sit for a long time. Based on the parking rate and the duration HKA’s aircraft were sitting, the airline was facing between $1.4 and $2.2 million in fees. It should be no surprise that the unpaid parking fees would prompt the authority to detain the aircraft.

Hong Kong Airline’s Response

HKA has confirmed the authority’s impounding of their aircraft. The airline said in a statement, “The AAHK has acted … to detain seven idle aircraft of Hong Kong Airlines in order to protect financial interests.” A Hong Kong Airlines spokesperson further explained, “Due to network consolidation, some of our aircraft have not been scheduled for operation and are currently suspended from service under the Airport Authority’s arrangement. Our current operation remains normal.”

My question is, why would HKA allow the aircraft to be parked for that long, accruing that much debt? Was it more expensive to fly the planes elsewhere, were they hoping for a bailout, or did they not plan for the planes to be sitting that long in the first place? Whatever the reason, I wonder where Hong Kong Airlines is going to go from here.

For the FlyerTalk on the subject, head to this forum thread.

[Image Source: Wikimedia Commons/Crisco 1492]