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PAL Drops Airbus for Boeing widebodies

As San Miguel Takes Over PR


April 27, 2012


The 747-800 may be Philippine Airlines flagship plane as the carrier intends to do more business with aircraft manufacturer Boeing Co. this time around according to Ramon Ang, President of San Miguel Corporation.

The airline is now looking more at Boeing's 747-800 program than the A380 of competing manufacturer Airbus.

Ang, a pilot himself, said the A380 cannot fit in the Philippines domestic airport, pointing the airports of Cebu and Davao as very inadequate to support the aircraft type because of its size. Meanwhile, the Boeing Aircraft (747-800) can fit at other domestic airports the airline intends to fly like Puerto Princesa, Cebu, Davao and General Santos.

Ang said there are only two airports capable of handling the A380 in the Philippines, Manila and Clark. While the Boeing 747-800 can be flown to five different domestic points. He further pointed out that the A380 is also too big for the Philippines saying that there is no market for the 600 plus capacity aircraft.  The A380 seats 644 in two class configuration while the B748 seat 550 in the same class. 

Philippine Airlines operates full service bi-class model, and continues to operate doing so under new management.

The carrier is now finalizing plans to order new wide body fleets, consisting of 12 Boeing 787's and and possibly 4 Boeing 747's to replace its ageing fleet which consists of 5 B747s, 4 A340s. and 8 A330's. 

It has 4 Boeing 777-300ER on orders with 2 for delivery this year, and another 2 for delivery next year. It also plans to get 4 more of the same aircraft type so that by 2020 they may have a fleet of 4 B748, 10 777-300ER, and 12 B787. 

The first set of B787 is scheduled to be introduced to the airline in 2016 from aircraft lessors and will replace the A330 which will go to low cost subsidiary Air Philippines.

Meanwhile, the remaining narrow bodies will still be held by Airbus A320s accounting to 75% of PAL fleets, inclusive of Air Philippine Express orders.

Philippine Airlines new boss, Ramon Ang
The carrier’s two main owners Ramon Ang and Lucio Tan, will provide $1 billion capital build up to help fund the fleet expansion program that would buy the airline 80 new aircraft.

Ang however cautioned that the long-haul expansion plans depend upon the Philippines improving safety standards soon as they will fly immediately to New York via Vancouver, Seattle, San Diego and Chicago when the category rating of the country is upgraded to Category 1.  It already flies to San Francisco, Los Angeles, Las Vegas and Vancouver in North America, as well as Honolulu and Guam.

Next on the airline's agenda is the return flight to Europe which will commence sometime in 2016 with the arrival of long ranged twins, referring to Boeing's newest baby, the 787 listing London, Paris, Rome, Barcelona, and  Frankfurt as destination.

The country is currently blacklisted by the European Union and has a Category 2 rating from the U.S. Federal Aviation Administration for failure of the country's aviation body to meet international safety regulations.

Third on the Agenda is the resumption of flights to the middle east, to be served by its low cost carrier Airphil Express to fly the 2.5 million overseas Filipinos working there who regularly travel back to the Philippines. Airphil Express will be utilizing the A330 to be dispose by PAL upon the arrival of B787s.
As part of the airline's route rationalization, PAL will stop flying to domestic airports where there is not much premium traffic  and some regional flights to Air Philippines, while focusing on long- haul, full-service trips. PAL already axed Ozamiz this year with additional destinations to follow soon.

San Miguel Corporation (SMC) is Southeast Asia's largest publicly listed food, beverage and packaging company with $11 billion (US) in gross revenue. It earned $481 million (US) in 2011 from $460 million in 2010.

34 comments:

  1. Good move, Mr. Ang. Replacing the 747-400s with 747-8Is can only mean savings as current -400 pilots need not train for a significantly different aircraft. Some parts from the -400 can work with the -8Is, saving costs, and airport terminals need not be re-designed to accommodate a significantly different aircraft type.

    If PAL decides to get GEnx engines for the 787s, that means at least 12 aircraft in its revitalized fleet would share the same engines, further cutting costs in MRO operations for the airline. GOOD MOVE.

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  2. It seems PAL is going through the best track with the best plans. But still...

    "Ang however cautioned that the long-haul expansion plans depend upon the Philippines improving safety standards soon as they will fly immediately to New York via Vancouver, Seattle, San Diego and Chicago when the category rating of the country is upgraded to Category 1."

    Can CAAP deliver? I hope so.

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    1. I am confident we will get cat I. This cat I thing is more of a political and economic issue sometimes. Indonesia was in the same boat with us a few years back; what did they do to get back to Cat I? They bought about 150 B737NG from the americans.

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    2. This is hogwash! Indonesia is still FAA cat. 2 country same as us.

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    3. It's time for the Philippine Airlines to replace Airbus to all Boeing. A340 and A380 are not profitable. Maintenance are very costly too many problems. PAL can add B787 more comfortable to fly long distance and the customer keep on flying....B787.

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    4. All of indonesias airlines EXCEPT Garuda Indonesia was downgraded to cat.2

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  3. I hope that they do Toronto, San Diego, Manila. I live ten minutes from the San Diego airport. I now drive to LAX. It is faster than taking a plane in total time. I will not fly San Diego , Vancouver, Manila. The total time of my house to Manila would be the same either way. But flying home would be an extra four hours. So I will still fly out of LAX.

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  4. 4 747-8i means 2 x daily trip out of LAX.

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  5. Other media sources are quoting a fleet of 100 while we are quoting a fewer number. The reason for the inconsistency was that existing orders for 4 of the 777 together with 3 320s for PR and 13 other 320's for 2P was included. They were existing orders by the airline. So we excluded them. Anyway, the argument was San Miguel will still be paying for them, thus, the 100 figure.

    By the way, PAL is bent on flying double daily to LAX and SFO via 77W and 748s as clearance come.

    Ang is aware that there are plenty of Filipinos in Florida but doesn't know how the airline could do it. A Manila-Toronto-Miami/Orlando may be in the works if Canada allows it. A 787 is a nice plane to ride indeed.

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    1. How many Filipinos are there in Florida? I'm married to one, but dont see that many. I'm in Fort lauderdale.

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    2. Considerable perhaps. Otherwise they wouldn't have thought about it. Anyway, lets see how far can they go after Cat 1.

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  6. Hopefully just like other airlines in our asian neighbors the flag carrier should try to fly from Manila to New York. MNL-JFK non-stop using new aircraft & energy efficient.........

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  7. Nice need more 767-400 or maybe, more a330 for middle east flights
    787and 747-8 to europe and america

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  8. If PAL has plans to order the B787s, I'll strongly consider the B787-9 because it has more range and more seating capacity than the B787-8. And the B787-8s is just too small widebody for PAL especially Europe and North America where majority are OFWs working in these said continents.

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  9. I think PAL won't stop flying domestic. Many passengers still choose to fly with PAL in domestic.

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  10. Finally! some progress to advance the airline. That's a pretty good order and plan Ang has. Europe needs to be done carefully though, the market is there but is not huge. I hope they recognize that doing a daily flight to every major city in Europe isn't smart. I expect them to do three weeklies like Vietnam Airlines. As for Seattle, Philippine Airlines better off just codeshare on a Seattle-Vancouver Flight, the two cities are too close to each other. I pray that these plans and promises are true and will start ASAP. (I wonder if Ang is planning on expanding or at least cleaning up NAIA 2)

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  11. FWIW, I would strongly recommend and humbly suggest that PAL start out small and get the basics right. While seats are important as passengers will have to spend a considerable time sitting on them, service delivery is also very very important to help distinguish them from their regional and international brethren. PAL management must take steps to provide a differentiated service that would make people across the globe want to choose to fly with them (much the same way a lot of people choose to fly SQ and CX). That means a truly astounding experience beginning landside up until arrival at their destination.

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  12. Good choice PAL! :)

    For me, Airbus A330 and A320 is the best that they can produce...

    but for Boeing, They have the iconic-fastest subsonic passenger plane Boeing 747, also B777, B787 for the long range category. Of course, the best seller B737 which is so sexy and take note, it is very fuel efficient...

    hopefully they could maintain a fleet of Boeing planes... :)

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  13. Great plans for PAL. I hope Ang also tackles the problem of inflight service. Filipinos are known for their hospitality but it sure does not extend to inflight service. More often than not, after meal service, the flight attendants are nowhere to be found. Secondly, upgrade F/As uniform. The female F/As look like public school teachers---that beige top and bottom are so cheap looking. Even with a nice scarf, these women still look like they got their clothes from a thrift store. Thirdly, upgrade those darn seats. Even with the upgrade 3 years ago, both business and economy, Lucio Tan chose a product that was years old. Ang must also think about installing premium economy. I am sure a lot of Filipinos traveling from the US to MNL would gladly pay for this product. I know I would. Lastly, get into the cargo business. Convert those 744s to cargo jets. The head of the Asian Development Bank is admonishing the Philippines to industrialize by increasing the share of manufacturing in its GNP. Ramon Ang, this would be an excellent business to engage in if you want to contribute greatly to the government's effort to industrialize. That's all folks!

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  14. I hope that PAL will join an alliance soon, particularly Oneworld.

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    Replies
    1. Agreed, but Skyteam would be better suited for them.

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  15. Ramon Ang really thinks and sees for what is unimaginable for others. I am also optimistic that PAL will regain its former glory in Asia with this great expansion programs. This also means more employment for the graduates of aviation schools and engineering. Also, aircraft type trainings for the existing maintenance provider of PAL. That's great news folks!

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  16. Pals new fleet should be this from boeing 12 B747 8s, 18 B787 9s, 15 B777 300ERs, 25 next gen B737s .. FROM AIRBUS 10 A380s, 18 A350s, 20 A321s neos, and 25 A320s neos. by 2020

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    1. But A380's for PAL will have to stop domestic routes, which Pal wants to do, & the only way to restore that is to extend the runways to manila & clark level W new airbridges

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  17. yes...looking forward to see PAL colors on Boeing long-range planes. PAL joining oneworld should even out the alliance membership in the SEA region.. Star has SQ and TG, Sky has VN and GA, while oneworld has MH and (hopefully) PR.

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  18. I'm hopefull to see new PAL livery...

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  19. PAL livery is very beautiful. But I would like to suggest that the small Philippine flag should be transferred near the front/near the nose of the aircraft instead of that near the last door/near the tail position...Or simple add another small Philippine flag in the front of the plane.

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  20. Well, yes indeed I agree to one post here that PAL FA uniforms really need an upgrade if not drastic change. I know PAL FA's are ladies and gentlemen we can be proud of and wearing a PAL uniform is something they can be proud of more. Aside from that, they should really work more on providing excellent service (not just better and best but excellent). A new PAL livery is an exciting idea. Although I like the current one but how about extending the Philippine Flag livery not just from the tail but also cover 1/4 of the outer body of the Aircraft. Change the font style of the word "PHILIPPINES". Just my idea. :-)

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    1. I think its better if the style of the word is still "Philippines" because I cant imagine an all bold letters in it

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  21. This Article was written in April 2012. It's now September and PAL just signed a firm order for 54 Airbus planes, including 10 A333 HGWs (High Gross Weight). This A330 variant was launched precisely to sway undecided and/or impatient potential 787 customers to go instead to the European maker. By performance (on paper at least), the HGWs matches the 787s and is available NOW. So does this development confirm the chatter that Boeing refused PAL's price haggling and gave it the proverbial "take it or leave it" pitch? By the way, in an interview published in Rogue Magazine Ramon Ang didn't sound too convinced with the B748s. I'm with him there. The 777-300ERs are the future for long range wide bodies.

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  22. Sayang naman sna order tyo a380 kht 2 fleets manlang tas I extend runway ng cebu at davao

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  23. I see that the Airbus A380 is better and will cost cheaper maintenance than the 747-8. It has more space and is really better and good looking than the b747. If the 747-8 is better then why did the other big-time airlines around the world order a380's? Extending the runway isn't a problem. The philippines should really think out of the box in these kind of things. What did hongkong and the other countries do? improve their facilities! not just sticking to the old facilities. Just like Singapore airlines, Emirates which is younger than PAL, Qantas, Lufthansa, Delta Air and bristish Airways.
    When I first arrived at naia terminal 1 I felt bad. not like the airport I departed from which was very good looking and had better facilities. Improvement and Innovation will give the Philippines more tourists.

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  24. Actually Philippine Airlines can operate from Clark via Manila because a380
    can travel passengers international like other airlines such as emirates

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  25. Now that Philippines is back to category 1, I think A380s make sense...

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