Now is the best time for Cathay Pacific to launch cross-border mergers and acquisitions, laying a solid foundation for further development into a global aviation company.
Cathay Pacific currently ranks second in Asia after All Nippon Airways.
If global airline companies are ranked, Cathay Pacific ranks seventh in the world in terms of international flights and number of seats, and its management level ranks among the top in the world.
Leaving aside the U.S. aviation market for the time being, it can be summed up as the battle among the seven countries for supremacy, and Cathay Pacific is not suitable to extend its hand there for the time being.
The European aviation market before 1990 can be described as a "fragmented sky", with aviation companies in various small countries operating independently and with strong protectionism.
There are many airline companies in Europe's bigger places, France alone has more than ten airline companies, and life is very cramped.
The restrictions on air traffic rights between countries are the same as those in China. If member countries want to open air routes, they must negotiate bilateral air traffic rights agreements.
To use an analogy;
The Netherlands has opened up Dutch-British air rights. Every time British Airways opens a route to the Netherlands, it must allow the Netherlands to open a new direct route to the United Kingdom with the same flight volume.
The benefits of doing so are obvious, as it can protect local aviation companies from threats and competition from other countries.
However, with the development of economic integration and the emergence of the wave of globalization, competition from powerful American airlines has exposed the shortcomings of its conservatism.
After 10 years of hard work, the EU has broken down regulatory barriers and regarded the EU as a single large aviation market.
This means that airlines can easily fly across borders, set up bases and sell tickets in any EU country.
The golden years of European airlines are gone forever. Wanting to grow under the sky protected by policies has become a lost dream.
in the following days
A wave of aviation liberalization has emerged, low-cost airlines have appeared, and a large number of airline companies have gone bankrupt due to poor operations. Mergers and unification have become mainstream.
If you want to win the right to survive in the global market, you must exert synergy and use your scale and network advantages to carve a way for yourself.
to this day
The internal integration of EU airline companies has generally come to an end. There are not many targets for mergers and acquisitions. There is a golden opportunity right now, and that is KLM Royal Dutch Airlines.
This so-called royal airline is worthy of its name, but you don’t need to pay too much attention to it, because the Netherlands, as the most low-key royal family in Europe, has almost no sense of existence.
It does not matter which European airline Cathay Pacific acquires. What is important is to gain a foothold in Europe, freely develop business in Europe, add routes, and expand international flights within Europe and to Asia.
Wang Yaocheng's business layout in Europe is not to acquire many heavyweight companies in Europe and add a long list of consortium companies.
Not like that at all.
After HSBC merges with Smithsonian Bank of the United Kingdom, its operating scale and assets under management will exceed one trillion US dollars, ranking second among the world's multinational banks. Quantitative changes will lead to qualitative changes, leading HSBC to the top ranks.
Its assets under management are second only to the world's largest bank, Bank of Tokyo-Mitsubishi UFJ, with US$1.75 trillion.
This is the most striking example.
Through the pace of global mergers and acquisitions, its subsidiaries have grown rapidly, with businesses and assets all over the world, playing the role of one plus one greater than two.
A global Cathay Pacific will promote the development of the global Hong Kong and Shanghai Hotel Group, bringing stable and high-quality passenger flow to its top hotel brands The Peninsula Hotel and Miramar Hotel, and vice versa.
HAECO, which has a global presence, will provide strong support to Cathay Pacific in the field of aircraft maintenance. The expansion of Cathay Pacific's fleet will also feed HAECO.
As a designated hotel group within the consortium, both middle and high-level executives of American and mainland companies have hotel vacation time as a benefit every year.
As a global consortium with more than 2 million employees, this is a substantial and stable income.
Of course, more than half of these employees cannot enjoy free hotel vacations, but they can enjoy preferential discounts.
As a very large OEM enterprise, Changjiang Technology Group has more than 830,000 employees and OEM products for the entire consortium and famous foreign companies, including;
Atlantic Business Machines, GREEN Group, Nokia, Fujitsu, Cisco, IBM, Apple and other world-renowned companies are the largest and most powerful OEM companies in the world.
As the enterprise that creates the most jobs under the consortium, Changjiang Technology Group has strong bargaining power and is able to maintain a net profit level of 15%. The development of its self-operated Dell brand has gone smoothly and it has become a leading product.
Yangtze River Technology Group itself owns large hotels in popular tourist cities, which provides employees with convenient travel and vacation, and also brings huge profits.
This is the only one within the consortium that Wang Yaocheng personally approved. No other company can imitate it.
The Carrefour supermarket chain has the second largest number of employees, with more than 270,000 employees in 200 hypermarkets and more than 1,000 center stores, creating millions of jobs in transportation and production areas.
Huanghe Technology Group ranks third with 236,000 people, 86% of whom are employees of Pacific Chain Home Appliances Store and Panda Electronics.
HSBC ranks fourth with 229,000 people. After the merger with British bank Smithsonian is completed, the number of employees will reach nearly 300,000, ranking second among the consortium.
Wang Yaocheng counted on his fingers and found that the scale of the consortium had expanded to an incredible level.
The number of domestic employees has reached 1.6 million. Hynix in Hong Kong, Macao, Taiwan and Southeast Asia, including the Korean Peninsula, has more than 410,000 employees, plus more than 230,000 in the United States and 28,000 in Europe. The overall scale is quite astonishing.
If you want to reduce costs, Asia and the United States can reduce costs by half, mainly because the industry is moved to China, but financial services and scientific research cannot be reduced.
Not only cannot it be compressed, it should also be greatly strengthened.
Closing factories is a very sensitive matter in Europe and the United States. Since companies are profitable, they will not consider it for the time being.
How can it be so cheap to just get the benefits without paying for it?
Promoting employment for a large number of people is a manifestation of social influence, but it cannot be considered purely from the perspective of economic interests, as that would be biased.
Having made up his mind, Wang Yaocheng happily went to take a bath.
After a while
The sound of water rushing in the bathroom, and the steaming white heat emerged from the cracks in the closed door, drifting away in strands.
Hong Fu, the deputy director of the Secretariat, opened the door and came in. He saw the chairman taking a shower in the bathroom and shouted through the door: "Chairman, dinner is ready. You will see when you can have dinner."
"What delicious food does the master cook?"
"Well... there are pan-fried veal and snails baked in cream, Spanish ham, vegetable salad and grilled lamb chops, as well as olive oil-fried fish fillet and mushroom soup, that's about it."
"Hey, I've lost my appetite after hearing this. What the hell... bring me some grilled lamb chops and pan-fried veal, as well as a vegetable salad and a bottle of French champagne. You don't need anything else."