Veteran Lam poised to take reins at Cathay

Cathay Pacific Airways' (0293) board is planning to meet today to vote on appointing long-time manager Ronald Lam Siu-por as the airline's new chief executive, according to people familiar with the matter.

Lam, Cathay's chief customer and commercial officer, is set to succeed current chief executive Augustus Tang Kin-wing, the people said, asking not to be identified because the subject is private.

The leadership shift is backed by the airline's biggest shareholder, business group Swire Pacific (0019, 0087) and second-largest Air China (0753) has expressed its support, according to the people.

Tang moved into the top job when the previous chief Rupert Hogg stepped down in 2019, after the airline became entangled in Hong Kong's anti-China protests. Tang, 63, went on to steer Cathay through one of its most challenging periods amid the Covid-19 pandemic.

A representative for Cathay declined to comment, while Swire didn't respond to multiple messages. Air China didn't respond to emails seeking comment.

Lam, 50, has worked at Cathay for 26 years. Should he be ratified as the new chief executive, he'll be tasked with leading the airline through its post-pandemic recovery, with ongoing travel restrictions into and out of Hong Kong.

Under Tang, Cathay went through a HK$39 billion government-led recapitalization, cut jobs and closed its regional airline Cathay Dragon.

While Cathay's situation has started to improve as Hong Kong dismantles much of its Covid border regime, the city still requires tests on arrival and limits what travelers can do. The airline also counted mainland China as it's biggest market pre-pandemic, a key vulnerability as Beijing persists with its zero-tolerance approach to the virus.

Passenger traffic is still only 16 percent of pre-Covid levels and Cathay has said it won't return to 100 percent until late 2024 or early 2025.

On Lam's immediate to-do list will be rebuilding Cathay's volume of flights. Singapore Airlines has already pushed far further into its recovery after the city-state where it is based dropped travel restrictions early this year. Its capacity is back to about 73 percent of 2019 levels, according to Bloomberg calculations, similar to major European carriers like Deutsche Lufthansa.

Lam said in September that Cathay's recovery would take time as it returns aircraft to service and trains staff. The airline's workforce has shrunk by about 40 percent since the start of the pandemic, limiting its ability to quickly add flights, and eventually repay the money it owes the Hong Kong government from the recapitalization.