PAL Returns New A330

26 March 2015

After cancelling five orders for Airbus A330-300 aircraft last year flag carrier Philippine Airlines (PAL) ha announced last week that it will be returning five A330-300 aircraft to lessors before the end of the year.

PAL president and COO Jaime B. Bautista said during the corporate board meeting held earlier this week that the new planes that will be returned to German lessors are the mono class A330-300 model currently used in the Middle East as it cancels future plans of expanding further in the Gulf region.

The eight single class A330-300s were ordered by Philippine Airlines in 2012 for Middle East operations. The airline has since flown to Dubai, Abu Dhabi, Riyadh, and Dammam. Plans to fly Doha, Jeddhah, Muscat and Kuwait fizzles as the airline adopts new strategy amidst changing economic conditions.

PAL entered into first Purchase Agreement with Airbus in 2012 for firm order of 10 A330 and 44 A321 aircraft with options for 20 A321 NEO aircraft for delivery in fiscal years 2014 to 2020. It signed a second purchase agreement for another 10 set of A330-300 for delivery in fiscal years 2014 to 2016.

Bautista said it posted profits of $50 million for January and February this year due to fleet rationalization plans.

PAL had first contemplated adjusting delivery schedule in October last year, with Mr. Bautista saying at that time that “there were too many orders from Mr. Ang’s management. We have too many A330's and A321's with nowhere to fly to... We really have to check if the market we’re servicing now requires all these planes.”

Mr Bautista previously said last year that they are "offloading" the single-class aircraft as it sees more need of the dual-class A330s, more so that they won't be opening new routes to the Middle East anytime soon.

Earlier this year, PAL deferred delivery of 38 Airbus A321 jets until 2024 from delivery time frame until 2020.

Bautista said that savings from the cancelled leases will be used to finance new orders for long haul aircraft to replace the A340-300 which will be announce soon. They are expected to fly the Philippine skies by 2020.

The airline is currently evaluating both the A350-900 and the Boeing 787-1000 for its long haul requirements complimenting the triple seven. The company however is holding its card tight as to future aircraft orders. There was no mentioned of the B777X program but Bautista said that a pair of brand new Boeing 777-300ERs will be added to the fleet soon for long haul flights to North America, its most profitable market.

CEB Installs Cargo Portal

26 March 2015

Cebu Pacific under joint venture with cargohaus inaugurated yesterday the state of the art Smiths Detection CIP-300 air cargo inspection portal at NAIA Terminal 3.

The air cargo inspection portal is the first of its kind to be installed in an airport in Asia. It will be for Cebu Pacific Air’s priority use for all transhipment cargoes loaded in international flights to and from Manila.

The air cargo inspection portal can accommodate and screen up to 9 tons of air cargo dolleys and unit load devices (ULDs). It is powered by a low-energy X-ray source and uses advanced material discrimination software which provides high quality images that reveal detailed contents of freight and baggage.

“CEB is proud to be the first carrier to use this state-of-the-art air cargo inspection portal. Enhanced speed and accuracy of cargo inspection would greatly benefit our shippers and consignees, as we continue to operate airport-to-airport cargo delivery via our extensive route network,” said Joey Macagga, CEB VP for Fuel and Cargo Operations.

DoF waives ICCs For Aircraft, Parts Imports

23 March 2015
Mikhail Franz E. Flores

AIRLINES with congressional franchises have been exempted from the import clearance process for equipment, machinery and parts, the Department of Finance (DoF) said in an order, citing compelling public interest.

In Department Order no. 028-2015, airlines were the latest group to be exempted from securing the importers clearance certificate (ICC).

“Airline companies granted congressional franchises may be exempted from obtaining the importers clearance certificate from the Bureau of Internal Revenue” on specific importations of aircraft equipment, machinery and spare parts, on the basis of overriding and paramount public policy, public safety and public necessity considerations,” Department Order 28-2015 stated.

The companies, however, are still required to submit accreditation requirements covered by other regulations.

“Any availment of the exemption provided in this Order shall be accompanied by a certification from Civil Aviation Authority of the Philippines on the necessity of the importation in view of public safety,” the order stated.

The Bureau of Customs (BoC) will submit a monthly report of all exemptions that have been allowed.

Last year, the DoF also exempted the Philipine Economic Zone Authority locators from the ICC requirement to promote trade facilitation.

The Finance department, on Feb. 6, 2014, issued Department Order 12-2014 requiring importers and brokers to secure a BIR Importer Clearance Certificate and a BIR-brokers clearance certificate as a requisite for accreditation with the BoC.

The new system aims to support the government’s goal of improving accountability and tax compliance.

Importers were originally given 90 days to comply with the new rule.

Of the 14,995 importers and brokers registered with the BoC client profile registration system before the July 31 deadline, 9,418 or 63% were able to comply.

However, it noted that only 11 or 0.1% of the total importers were able to beat the original May 21 deadline.

PAL Return To Tablas

22 March 2015

After 18 years absence, Philippine Airlines also returns to Romblon on it's Q300 plane thrice weekly.

Lucio Tan’s voyage

22 March 2015

By Roderick T. dela Cruz

New York—Lucio Tan, the 80-year-old billionaire chairman and chief executive of Philippine Airlines, and his wife Carmen have recently completed a round trip between Manila and New York, with a stopover in Vancouver in less than five days.

Along the way, Tan delivered three speeches, chatted with journalists, shook hands and took “selfies” with airline passengers, sang with Martin Nievera and clapped for a 90-year-old former PAL flight attendant in New York.

Tan says he is happy to take the long trip.  “I am very happy to be here to welcome you to the inaugural flight to New York City,” says the once camera-shy Tan, who heads an empire of businesses ranging from air transport, airline services, travel, banking, alcohol and tobacco, hotel, real estate, education, agriculture and trading.

Proud moment
PAL chairman Lucio Tan (left), his wife Carmen (second from left) and
PAL president Jaime Bautista (right) recognize Rebecca Verzosa-Santos,
PAL’s first international stewardess who flew on the first Manila to
California flight in 1946, during a reception at New York Hilton Midtown
Manhattan Hotel. Santos now lives in New York.

Tan is not the only person who takes pride about PAL’s return to New York, after an 18-year absence in the world’s financial capital.  Tourism Undersecretary Benito Bengzon says the return of PAL to New York is “certainly a proud moment for Philippine aviation, proud moment for Philippine tourism and certainly a proud moment for us Filipinos.”

Tan feels comfortable inside the Boeing 777-300ER (PR 126) that took him from Manila to Vancouver to New York and on board the Airbus A340-300 (PR 127) that brought him back to Manila.  “I wish to thank my PAL family for their effort in making this US east coast service a reality,” he says.

The trip took about 19 hours, each way.

PAL president and chief operating officer Jaime Bautista says it is Tan’s dream to return to the Big Apple.  “PAL is today back in New York because of the vision and drive of one man--our chairman Dr. Lucio C. Tan. It was also under Tan’s leadership 18 years ago that PAL first flew to the city. He has made sure we would return no matter how long it took under his watch,” says Bautista.

PAL’s Manila-Vancouver-New York service, covering 14,501 kilometers, takes about 16.5 flying hours, making it the airline’s longest route.  The new service operates between Manila’s Ninoy Aquino International Airport Terminal 2 and New York’s John F. Kennedy International Airport’s Terminal 1.

“Although this is billed as an inaugural flight, it is not the first time for PAL to New York. From September 1996 to August 1997, we operated a service to Newark Liberty Airport that initially introduced our brand here in the Big Apple.  Deep in our hearts, we knew that one day, PAL would be back in New York. After 18 years, that day has come and that day is March 15, 2015, which is also our founding anniversary,” says Bautista.

The 74-year-old airline, the oldest in Asia which flew its first aircraft from Manila to Baguio on March 15, 1941, is embarking on US network expansion this year following the lifting of the Category 2 rating to Category 1 by the US Federal Aviation Administration.

First flight attendant
Tan met 90-year-old New Yorker Rebecca Versoza-Santos during a gala at the New York Hilton Manhattan Hotel in celebration of PAL’s return to New York after an 18-year hiatus.

Bautista says Santos is the first post-war international flight attendant.

Lucio Tan sings with Martin Nievera on board PR 126.
She was 22 and was the only flight attendant when PAL flew a DC-4 for a 41-hour first trans-Pacific flight across the Pacific Ocean to bring home 40 American soldiers to Oakland, California on July 31, 1946.

Santos, who now lives in the Chelsea section of New York, served with the airline for 41 years, wrote PAL’s first manual for flight attendants and trained Japan Airlines’ first cabin crew.

A graduate of the University of the Philippines and De La Salle University, she later joined the United Nations in New York.  It was a fitting tribute for a New Yorker, as

PAL marked its return to the Big Apple for the first time in 18 years, says Bautista.

Tan’s voyage actually began in Jinjiang, Fujian, China where he was born on July 17, 1934. His parents brought him to the Philippines as a toddler.  He grew up poor in Camarines Sur and he had to work as a laborer at the Bataan Tobacco Factory to help pay for his education.

Through hard work, he obtained a degree in Chemical Engineering from Far Eastern University in Manila.  He eventually became a successful businessman and one of the richest in the Philippines.

From Manila, he expanded his business empire to Hong Kong, China and Guam.  PAL’s return to New York extended his operations to the world’s financial hub, a goal that almost every tycoon has in mind.

Shared history
US Ambassador to the Philippines Philip Goldberg says “PAL’s return to New York is symbolic to both countries.  It is a testament to our friendship, common history, our shared heritage.”

Lucio Tan takes a “selfie” with a PAL passenger.

“Our ties are further strengthened by over 3 million Filipinos in the United States and it is no surprise that PAL is now going to help service the community on the east coast,” he says.

“The airline industry, the air traffic between our two countries is growing. Tourism is growing and this is a wonderful opportunity to add another route.  New York is the Big Apple, the city that never sleeps and the capital of the world.

It is a known destination for so many business people, the fashion industry, the food industry, the museums, Broadway, all of the things that people will enjoy,” says Goldberg.

The American diplomat says he is pleased that PAL decided to fly a Boeing aircraft for the inaugural flight.  “The aircraft that PAL will be flying is a Boeing with General Electric engines and we know you are going to have a very safe and very nice flight,” he says. “I am sure there will be announcement of new routes to the United States in the months ahead not only because it is such an important market, but because of the deep relationship between our two countries,” says Goldberg.

Goldberg’s counterpart agrees.  “The US and the Philippines have special relationship that dates back to over a hundred years. We have a shared history. We have shared values in terms of democracy and freedom of speech. The Americans that come to the Philippines feel so much at home. There is no language barrier, because English is spoken by so many Filipinos,” says Philippine Ambassador to the United States Jose Cuisia Jr.

Skilled pilots
Bautista says PAL’s modern aircraft and highly skilled pilots will ensure safe and convenient flights across the Pacific Ocean.  “If you try Philippine Airline flights, you will experience very smooth landing. We are very proud about our own pilots.  We hire only Filipino pilots. We don’t hire foreign pilots at this time, although we are not banned from hiring foreign pilots,” he says.

“Right now, PAL has an average age of a little more than three years. It makes the airline more operationally efficient,” he says.

The flag carrier, which started flying to New York via Vancouver in September 1996 ended the operation in August the following year, because of the restrictions associated with the Category 2 rating imposed on the Philippines by the US Federal Aviation Administration, according to Bautista.

Return to New York

A view of Manhattan , New York skyline from New Jersey
“We started our flights to New York in 1996 and during that time, the Philippines was under Category 2, as downgraded by the Federal Aviation Administration.

Because we were under Category 2, PAL could not add new airplanes because that was a penalty for being under Category 2.

It is the airlines that were being penalized, but because Mr. Lucio Tan wanted to have presence in the United States, and especially here in New York, we entered into a wet lease agreement with an American carrier but that wet lease agreement did not become successful, because it was a little bit costly,” says Bautista. (The real reason for stopping New York and other EU destinations was the Asian Financial Crisis that hit in 1997 which plagued home currency making flight operations very expensive. It was not the category 2 rating. The airline declared bankruptcy a year later in 1998. ed)

“So we stopped our operations to New York, to Newark Liberty Airport after one year, but we continued our operations to Los Angeles, San Francisco, Honolulu and Guam. Since then, we have increased our presence to the west coast of the United States from four flights a week in Los Angeles, four flights a week in San Francisco. Now, we have 11 flights a week in San Francisco and Los Angeles. Recently, we have increased our presence in Honolulu, from three flights a week to five flights a week. We have also increased our presence in Guam from four flights a week to daily during the Christmas season. These are the routes that we operate here in the United States,” he says.

US destinations
The New York service brought to five its total US destinations, following Los Angeles, San Francisco, Honolulu and Guam.

Bautista says PAL’s on-time performance has been improving, except for issues surrounding airport congestion.  “Right now, we are reporting an on-time performance of around 80 percent, which is a little bit below industry standard, but this is because of a lot what you call external factors in the Philippines,” he says.

“If we will not consider the external factors, which include airport congestion, because effectively we have only one and a half runways in Manila and with so many flights, there are admittedly delays because of these external factors. But if we do not consider these external factors, the average on-time performance of PAL’s flights reported on a regular basis is over 95 percent and this is because we have implemented a lot of reforms in terms of operating our airplanes. We take advantage of new technologies. Our airplanes are equipped with state-of-the-art equipment,” says Bautista.

Bautista says PAL aims to further increase its number of flights to Canada and the United States.  “We are operating four flights a week to New York.  Under our existing agreement with Canadian and US authorities, we can operate a maximum of only five flights a week.  For us to be able to increase the frequency to New York via Vancouver, we need to work with the Canadian government,” he says.

Daily flights
“Our people really wanted a daily flight because a daily flight is a better product than four times a week, but since we are still in the development stage, we started with four and then maybe we can increase it to five using all the entitlements and then work with both the FAA and with the US and Canadian authorities to have more entitlements,” says Bautista.

“We continue to study possibilities of flying to new destinations in the US, because the US is a very big market of PAL, having 3 million Filipinos in the US,” he says.

Bautisa says the Manila-New York service will be beneficial to over half a million Filipinos residing in the US east coast, including 253,000 in the New York-New Jersey metropolitan area, 90,000 in Virginia, 75,000 in Washington D.C. and environs and 31,000 in the Philadelphia metro area.

“We have very good bookings on the flight from Manila to Vancouver to New York,” says Bautista, referring to the inaugural flight. We carried more than 300 passengers from Manila to Vancouver. There were 50 who got down in Vancouver, but there were 40 who joined us in Vancouver to New York. For the return flight from New York to Manila, admittedly, the load factor was not that good. There were a little over 100 passengers, but there were passengers who took the flight from Vancouver to Manila,” he says.

“We are in the early stage of development of the route. We are expecting that this route will become a very busy route, considering that there are like 250,000 Filipinos in New York and New Jersey area. Plus we will be able to carry passengers from other east coast cities like [Miami] Florida.  We are also working with some American carriers, as partners. We don’t have code-share agreement, but we have already prorate agreements to allow us to offer attractive fares from Manila to New York to other east coast destinations. We are expecting that the load will improve in three to six months,” says Bautista.

Tourism boost
Tourism officials say the new Manila-Vancouver-New York service will help the Philippines attain its goal of attracting 1 million tourists from the US annually.  Michelle Dy, the officer-in-charge of the Tourism Department in New York, says PAL’s flights between Manila and the US east coast will encourage more US tourists as well as Filipino-Americans holding US passports to visit the Philippines.  “This is exciting news for east coast travellers who now have access to convenient flight options to Manila,” says Dy.

PAL B777-300ER Lands in New York's JFK Airport

The US emerged as the second largest tourism market of the Philippines in 2014, next to South Korea.  International visitor arrivals in the Philippines rose 3.3 percent in 2014 to 4.83 million from 4.67 million in 2013.

South Korea kept its position as the leading source market with 1.175 million visitors, followed by the United States with 722,750 arrivals.  The number of visitors from the US grew 7.14 percent last year, data from the Tourism Department show.

Earnings from inbound tourism in 2014 hit $4.84 billion, up by 10 percent from $4.4 billion in 2013.  Visitors from Korea had the highest contribution at P61.02 billion, while the United States contributed P41.43 billion and Canada added P8.48 billion.

“We share the excitement and optimism of Philippine Airlines as it returns to the US east coast because this now allows the Department of Tourism to reach out to a very important geographic market—New York, many parts of the US east coast and many parts of Canada.  The flight connects not only to Manila, but also many island destinations in the Philippines,” says Bengzon, the Tourism undersecretary.

Visit Philippines
PAL’s flight PR 126 departs Manila every Tuesday, Thursday, Saturday and Sunday at 11:50 p.m.  Arrival in Vancouver is 8:50 p.m. on the same day.  After a two-hour transit stop, the service departs for New York at 10:50 p.m., touching down at Terminal 1 of JFK International at 7 a.m. the following day.

The return service, PR 127, departs New York at 11 a.m. every Monday, Wednesday, Friday and Sunday, arriving in Vancouver at 1:50 p.m.  It departs the Canadian city at 3:20 p.m. and lands in Manila at 8:35 p.m. the following day.

PAL offered a round-trip all-in fare of $1,174 or P52,830 for the inaugural Manila-Vancouver-New York service.

PH Airlines Clears EU Ban

21 March 2015

All Philippine-based carriers are expected to be removed from the European Union overflight ban by June this year after its Civil Aviation Authority (CAAP) convinced the European Commission (EC) of safety standards compliance under their jurisdiction.

“The EU will assess the safety of flights of all airlines that are still blacklisted when they come to the Philippines from April 14 to 24 for safety audit,” Beda Badiola, Deputy Director of the Civil Aviation Authority of the Philippines (CAAP), said.

“There were positive results during the meeting of CAAP and EC representatives in Brussels last week.” says Badiola adding that “The safety assessments of Philippine-based airline have reached international standards, to EC’s satisfaction.”

To date, only Philippine Airlines and Cebu Pacific are cleared to fly European Airspace, having cleared the respective airlines in July 2013 and 2014, respectively.

Skyjet Sold

20 March 2015

Full service airline SkyJet (Magnum Air SkyJet, Inc.) is sold to media conglomerate Solar Group after the Civil Aeronautics Board (CAB) approved the transfer of its ownership to Thunder Air Aviation, Inc., subsidiary of Ronald C. Tieng's Solar empire.

Tieng was elected the airlines Chairman with Dino Carlo Chua as President, Capt. Ted Fojas as Chief operating officer and Atty. Theodore Sarmiento as Corporate Secretary.

Skyjet (M8) flies to Basco, Coron, Busuanga, and Caticlan with a fleet of 1 BAE 146-100 and 1 Dornier 328.