Cathay Pacific promotes Rupert Hogg to chief executive

Cathay Pacific flight CX105, operated by Airbus A350-900 B-LRI arrives in Melbourne. (Cathay Pacific)
Cathay Pacific has been taking delivery of next generation Airbus A350-900s to replace older less fuel-efficient models. (Cathay Pacific)

Cathay Pacific has promoted chief operating officer Rupert Hogg to become the airline’s new chief executive.

Hogg will take over from current chief executive Ivan Chu on May 1, Cathay said in a statement on Wednesday afternoon.

Rupert Hogg. (Cathay Pacific)
Rupert Hogg. (Cathay Pacific)

Chu, who has been chief executive for a little over three years having been appointed in March 2014, will become chairman of John Swire & Sons (China) Limited, the Chinese arm of Cathay’s majority owner Swire Group.

While it has been common practice in recent times for Cathay to appoint a new chief executive after about three years in the post, the transition occurs at a difficult time for the oneworld alliance member, which in March reported its first annual loss since 2008.

Cathay chairman John Slosar said Hogg would bring an experienced aviation and business background to the job.

“He has played a major role as chief operating officer over the last three years and brings commercial focus and a spirit of innovation to our efforts to overcome the well-documented structural challenges facing the airline,” Slosar said in a statement.

“He is the right man to lead our team.”

Cathay, and others, have battled the rapid international expansion of Chinese airlines and the ongoing rise of Middle East carriers offering long-haul to long-haul connections through their hubs, which have bitten into previously lucrative markets. And in Asia, low-cost carriers have won passengers happy to pay lower fares for a no-frills product on short- and medium-haul routes.

Ivan Chu. (Cathay Pacific)
Ivan Chu. (Cathay Pacific)

Further, the economic slowdown – both in China and elsewhere – had led to a significant reduction in premium corporate travel in business and first class, particularly on long-haul routes.

The airline is in the midst of a corporate transformation plan comprising a reorganisation of the business, staff layoffs and other cost reduction efforts in an effort to return to profitability.

Slosar said Chu had led efforts to improve the airline’s performance through the transformation plan.

“Ivan played a key role in the airline’s management during some very good times and, more recently, some difficult and challenging times,” Slosar said.

“In response, he led the team in devising the three-year transformation strategy which will provide the platform for Cathay’s medium term recovery and continued development.

“I look forward to working closely with Ivan in his new role as Chairman of John Swire & Sons (China). He brings a wealth of experience doing business in China to that role and to our substantial portfolio of companies and ventures embracing aviation, property, beverages, cold storage, retail and food businesses in Mainland China.”

(Read more about the issues facing Cathay Pacific in the March edition of Australian Aviation magazine.)