February 20, 2017, 4:45 pm
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Rosy outlook for Philippine civil aviation

MORE than a year after the Philippines regained aviation ratings upgrade from US Federal Aviation Administration (FAA) the country has been competing fiercely in the US market.

The safety ratings upgrade is a milestone in aviation sector specially with the flag carrier, Philippine Airlines (PAL) which immediately replaced its aging aircraft - Airbus 340s and B747-400s  -- with more efficient B777-300ERs and expanded  routes in North America.

PAL has added Manila to New York via Vancouver in March 2015 and in 2016   will launch   non-stop flights from Cebu to Los Angeles.

The thrice weekly service to LA will utilize the 254-seater bi-class Airbus A340 with 36 lie-flat seats in business class and 218 seats in regular economy.

The flag carrier currently operates 35 weekly flights to mainland USA and two US territories combined. From Manila, PAL operates eleven weekly flights to Los Angeles, ten weekly flights to San Francisco and four weekly flights to New York.

PAL has five weekly flights each to Guam and Honolulu.

“We continue to study possible expansion of our flight route network in Europe and the United States.” PAL President Jaime J. Bautista told Malaya Business Insight via email.

PAL resumed operations in Europe in November 2013 with the  launch of  five times weekly flight Manila-London Heathrow .

Other potential routes that PAL is considering in continental Europe include Amsterdam, Frankfurt, Paris and Rome.

Aside from routes expansion the company also continues its fleet modernization, and service innovation.

PAL is expected to sign a deal for the acquisition of $1 billion worth of six ultra long-range aircraft next month.

“Our goal is to sustain the flag carrier’s financial health by carrying out workable initiatives which lead to improved over-all performance.  We aim to maintain cost-efficient operations; further increase yields; and further improve passenger load factor,” Bautista said.

PAL has started to return in profitability in end of 2014. It was sustained in the first nine months last year after its profit ballooned to P 6.547 billion from P 169.1 million net income in the same period last year driven by higher passenger revenues.

Five months after the ratings upgrade, Lucio Tan Group bought back its stake in PAL from San Miguel Corp for $1 billion. Currently, Lucio Tan owns a 100% stake in PAL Express and   89%   in PAL Holdings with the remaining 11% held by individual investors under the public float.

Cebu Pacific (CEB), the country’s leading low cost carrier, meanwhile marks its entry in US territory (Manila-Guam) with a fare offer 83 percent lower compared to the competition.

Lance Gokongwei Cebu Air Inc president, said: 

“We intend to continue flying to where the Filipinos are to provide them the most affordable and fastest way to get home, or to visit their loved ones all over the world.” 

Aside from Guam, CEB also plans to expand to Honolulu and  Europe .

CEB offers flights to a network of over 90 routes on 60 destinations, spanning Sydney, Dubai, Doha, Bali, and Tokyo (Narita). On December 17, 2015, the airline launched three new routes: Manila – Fukuoka, Cebu – Taipei, and Davao – Singapore.

CEB’s 55-strong fleet is comprised of 8 Airbus A319, 33 Airbus A320, 6 Airbus A330 and 8 ATR-72 500 aircraft. It is one of the most modern aircraft fleets in the world. Between 2016 and 2021, Cebu Pacific will take delivery of 5 more brand-new Airbus A320, 30 Airbus A321neo, and 16 ATR 72-600 aircraft.

The country’s budget carriers include PAL Express flag carrier Philippine Airlines, CEBGO formerly known as Tigerair Philippines a subsidiary of Cebu Pacific  and Philippine Air Asia a unit of AirAsia Bhd., Asia’s largest budget carrier. Other airlines include Island Aviation Inc., Magnum Air’s (Skyjet Inc.), and South East Asian Airlines (SEAIR) International Inc.
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