PAL Bids Farewell to the Queen of the Skies

Time To Say Goodbye!

April 24, 2014

Philippine Airlines (PAL) will bid farewell to its flagship fleet of Boeing 747-400 in May as it completes the first stage of its major fleet modernisation programme.

The airline signed a $9.5-billion deal with Airbus in August of 2012 covering 34 A321ceo, 10 A321neo (new engine option) and 10 A330-343s with 10 more options slated for delivery between 2013 to 2019. In 2013 however, 5 A330-343 option orders were traded for 8 additional A321neos as part of fleet renewal.

No announcement has been made by the airline as to the last flight of the seven four sevens whose retirement has been announced Tuesday.

PAL’s main long-range fleet of six Boeing 777-300ERs were set to replace its four aging Boeing 747-400s plying the Manila to San Francisco and Los Angeles routes, PAL President and COO Ramon S. Ang said.

“2013 was a clean-up year for PAL as we go through the costly yet necessary fleet renewal process but we are on track with our goals and we remain committed to improving your airline’s financial and operational performance,” says Ang in a statement.

Ang also added that switching to fuel-efficient B777s would result in about $160 million in annual fuel and maintenance savings in the near-term for the airline.

PAL reported a comprehensive loss amounting to $229.7M for the first nine months of 2013 following a one-off expense of $261M consisting of 20 pre-termination penalty payments of its sold-and-leased-back jets covering four Boeing 747-400s, four Airbus 340-300s, eight Airbus 330-300s, and four Airbus 320-200s to be stricken off its fleet this year. 

Ang likewise discloses that by 2015 PAL will be one of Asia’s airline operating the youngest fleet at 4.5 years old seen to reduce costs amid expected productivity gains.

Ang did not answer queries whether new wide body orders for long haul are forthcoming but said the airline’s six Boeing 777s would be “enough, for now” to the US West Coast and soon to be launch flights to the US East Coast, the airlines most profitable destination.
PAL formally announce deployment of all their Boeing 777-300ER planes to the United States almost three weeks after breaking the news story on this blog. You can read our reports here
PAL President and COO Ramon S. Ang quips jokingly about Cebu Pacific President Lance Gokongwei being his idol.
(L-R) Philippine deputy director of civil aviation authority (CAAP), John Andrews, and director general William Hotchkiss, European Commission (EU) representative to the Philippines, Julian Vassallo, Philippine Transport secretary Joseph Emilio Abaya, president and CEO Cebu Pacific, Lance Gokongwei, and president Philippine airlines Ramon Ang, lock arms after a press conference in Manila, on April 10, 2014, after the EU lifted the ban on Cebu Pacific from flying to EU member nations. AFP PHOTO/TED ALJIBE /Getty Images)

New York, New York!

11 April 2014

Philippine Airlines McDonnell Douglas MD-11/ER from Manila via Vancouver in Newark-Liberty International, New York

Philippine Airlines (PAL) finalizes plans for direct services to New York as early as summer this year with Chicago as  next stop in the United States expansion, the airline chief executive discloses Thursday after formal announcement by the Federal Aviation Administration (FAA) restoring the Philippines status to Category 1 rating.

Airline President and CEO Ramon Ang said that PAL was long ready drafting its expansion plan to the United States of America its most profitable market.

Ang said New York will be flown direct from Manila by Boeing 777-300ER planes in a new home, John F. Kennedy airport. 

PAL served New York's Newark airport via Vancouver in Canada until it stopped operations in 1997 due to the Asian Financial Crisis.

Meanwhile, Chicago flights will also be flown direct by Boeing 777-300ER aircraft sometime in November in time for the holiday season.

The airline said its Vancouver and Toronto operations in Canada will stay to be service by its brand new A330-343X fleet. It is also evaluating triangular service to Miami via Toronto or Vancouver pending results of negotiation with Canadian authorities by the Philippine government. 

PAL has limited fifth freedom rights in Canada to the United States which the airline used when it flew to Las Vegas, Nevada. It has no fifth freedom traffic within the US.

Among the expansion plans for this year include increase frequency to Los Angeles to 14 times a week, 7x to Honolulu, and 14x to Agana.

CAT 1 Finally!

10 April 2014

FAA's  John Barbagallo
WASHINGTON– The U.S. Department of Transportation’s Federal Aviation Administration (FAA) today announced that the Republic of the Philippines complies with international safety standards set by the International Civil Aviation Organization (ICAO) and has been granted a Category 1 rating.

The country previously held a Category 1 rating until January 2008, when it was downgraded to a Category 2. A Category 2 rating means a country either lacks laws or regulations necessary to oversee air carriers in accordance with minimum international standards, or that its civil aviation authority – equivalent to the FAA for aviation safety matters – is deficient in one or more areas, such as technical expertise, trained personnel, record keeping or inspection procedures.

The return to Category 1 status is based on a March 2014 FAA review of the Civil Aviation Authority of the Philippines. A Category 1 rating means the country’s civil aviation authority complies with ICAO standards. With the International Aviation Safety Assessment (IASA) Category 1 rating, the Republic of the Philippines’ air carriers can add flights and service to the United States and carry the code of U.S. carriers.

As part of the FAA’s IASA program, the agency assesses the civil aviation authorities of all countries with air carriers that have applied to fly to the United States, currently conduct operations to the United States or participate in code sharing arrangements with U.S. partner airlines and makes that information available to the public. The assessments determine whether or not foreign civil aviation authorities are meeting ICAO safety standards, not FAA regulations.

In order to maintain a Category 1 rating, a country must adhere to the safety standards of ICAO, the United Nations’ technical agency for aviation that establishes international standards and recommended practices for aircraft operations and maintenance. 

SEAIR Ain't Dead!

Resurrects April 16

10 April 2014

Like a Phoenix rising from the ashes, It ain't over for South East Asian Airlines International Inc. (SEAIR-I) as it begins scheduled flight on April 16 from Clark International Airport after securing regulatory approvals from the Civil Aeronautics Board (CAB).

The carrier’s airline operating certificate (AOC) was approved last November 21, 2013 by the The Civil Aviation Authority of the Philippines (CAAP).

The airline with a fleet of two 32-seater Dornier 328's will start flying from Clark to Caticlan five times a week and Clark - Caticlan - Puerto Princesa thrice weekly. 

Another route network is being drawn to service more destinations such as Bantayan, Masbate, Marinduque, Camiguin and Guiuan.

Services will either originate from Clark or Cebu after losing all landing slots at Ninoy Aquino International Airport (NAIA) in Manila. It can however ferry passengers from Manila on charters.

All the landing slots of the old company, South East Asian Airlines Inc. was sold to Tigerair Philippines which also was subsequently bought by Cebu Air Inc. (Cebu Pacific) in a deal worth US$15 million.

SEAIR-I launched its maiden flight as a leisure airline from Manila to Basco, Batanes on December 7, 2013.

5J Cleared To Fly EU

9 April 2014

Low Cost Carrier Cebu Pacific (CEB) of the Philippines has been cleared by the European Commission Air Safety Committee (ASC) Tuesday to fly to any States within the European Union nine months after it allowed Philippine Airlines to fly its Airspace.

The European Commission in its 23rd update removed CEB from the list of airlines subject to an operating ban or operational restrictions within the European Union, better known as "the EU air safety list". 

The Commission will likewise decide the fate of all airlines from the Philippines whether they shall remain on the EU air safety list after the Philippine Aviation Authority (CAAP) made earnest efforts to improve aviation safety as noted by the EU Air Safety Committee.

Julian Vassallo, Charge d'Affairs of the EU delegation in Manila said the EU will send another assessment team in the next few months with the aim of lifting the ban on Philippine-based airlines as whole in November.

Earlier last year, the Philippines got a positive impression by the EU’s ASC in Belgium after ICAO lifted the remaining significant security concerns regarding the Philippines in February 2013.

The safety rating of the Philippines was downgraded by the US FAA in 2008 to Category 2 upon the recommendation of the International Civil Aviation Organization (ICAO). 

A similar observation was noted by the United States Federal Aviation Administration (FAA) last month when it send its chief inspectors to the country and is about to announce it's new safety rating for the Philippines tomorrow. 

The airline manifested intention to fly to Italy via Dubai using Airbus A330-300 aircraft.

PAL to Order Airbus 350-900 Soon!

6 April 2014

Philippine Airlines (PAL) cancelled five A330-300HGW orders last month due to range issues with the plane after the airline failed to come to Aeroflot's terms on using Russia's Siberian Airspace.

The remaining five orders for the 242t A330-300 variant is unaffected and will begin delivery on the last quarter of this year. 

The airline however is preparing to replace the cancelled orders with the next first set of wide body orders either from Boeing or Airbus for long haul operations. Unconfirmed report from inside sources disclose it to be four initial orders for the Airbus A350-900 which will be presented to the Board for approval and scheduled for delivery in 2018.

The Airbus A350-900 which is scheduled to enter service this September has range of 7,750nm which, like the Boeing 777-300ER, can fly to as far as London using the current flightpath which range is impossible to be achieve by the latest 242t A330-300 variant that can manage only 13 hours of flight time equivalent to 6,100nm.  The newest A330 can fly to London overflying Russia but not the current route PAL is using to Europe.

The airline has been forced to use a longer flightplan to Europe using Bangkok, India and Iran as waypoints because of the impasse. It is expected to be using the same route towards Amsterdam, Paris and Frankfurt. The current flightpath to London from Manila is more than 13 hours or two hours longer than from overflying Russia. 

The A350-900 has smaller capacity than Boeing 777-300ER but bigger than Boeing 787-800 which according to the airline fits better for its pan-European operations.

PAL is scheduled to fly more points in Europe this year using the leased A340-300 aircraft from Airbus Financial Services (AFS).

India’s GMR Infrastructure Wins Cebu Airport Expansion Project

5 April 2014

The Department of Transportation and Communications (DOTC) awarded Friday the first Public-Private Partnership (PPP) airport project in the country to Megawide Construction Corp. and India’s GMR Infrastructure with a price tag of P17.5 billion.

The award came after resolving allegations raised by the second highest bidder Filinvest Development Corporation, a partner of Singapore’s Changi Airport Group Pte ltd., over the financial capability of GMR to fulfill its contractual obligations which currently operates airports in New Delhi and Hyderabad. Filinvest also sought disqualification of Megawide-GMR due to alleged conflict-of-interest.

Megawide-GMR consortium has denied all allegations.

Megawide-GMR consortium topped all other bids with an offer of P14.4-billion to the government in exchange for the right to operate Mactan-Cebu International Airport Terminal facility for 25 years which include building new terminal structure intended for international operations that can accommodate 8 million expected passengers that will use the new facility for the next 30 years. The old Terminal will likewise be re-configured for domestic operations with expected capacity of 16 million passengers per year.

“The existing terminal was built in 1995 and it had a capacity of around 4.5 million passengers per year, which was breached in 2010 when we exceeded 5 million passengers,” says Nigel Paul Villarete, General Manager of MCIA Authority.

Villatete notes that there is one international traveller for every 3 domestic travellers and DOTC projections for the next 20 years might not be enough to accommodate future influx of passengers at the airport.

Mactan airport handled 6.9 million passengers in 2013. In the same year passenger traffic grew at the rate of 14% for domestic flights and 11% for international flights.

Mactan-Cebu International Airport is the second busiest airport in the Philippines.