31 January 2015
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| Chicago-based United Airlines disclosed on Friday that they will soon fly across the Pacific to San Francisco from Manila says United Airlines vice president for sales in Atlantic and Pacific Jake Cefolia. Cefolia said United will be using the world's newest aircraft, the Boeing 787-900 Dreamliner for the route as the airline prepares to grow its market share to North America. United Airlines has ordered 26 aircraft to bridge thinner routes in the Pacific and South America. It has already flown to Melbourne from Los Angeles, the longest Dreamliner route in the world to date. It intends to open the route this year. The airline opened six new routes in the Asia Pacific region last year, adding Taipei-San Francisco, Haneda-San Francisco, and Chengdu-San Francisco. It also opened Incheon-Guam, Melbourne-Los Angeles, and Shanghai-Guam. “There is a tremendous amount of demand, sometimes it seems insatiable demand in Manila. It is the highest volume market between Asia and the US. However, it is also an incredibly price sensitive market,” he said. United's 787-900s will boast 252 seats, including 48 lie-flat business-class seats, 88 Economy Plus seats and 116 in standard economy. The airline currently flies to Guam and Koror in Palau 13 times a week using a Boeing 737-800 aircraft. United Airlines started flying to the Philippines in 1985 flying to San Francisco via Tokyo Narita. It bought PAN AM rights to fly to the country and continued its operation which started flying to Manila in 1942. |
they can start with seasonal SFO-MNL-SFO give PAL a run for their money! game changer GUM-CEB-GUM
ReplyDeleteDid you know united airlines once compete with pal on manila-north america routes during 80's and early 90's
DeleteO yes, but the old legacy United did not see this sustainable as MNL-North America route is price sensitive market, while UA was very much focus on the business travellers. UA807 SFO-SEL-MNL that was the old routing. Now because of consolodation and legacy CO running the new United things have change.
DeleteUnited or any other American carriers doesn't have 5th Freedom rights to fly Seoul. United was able to enter the country after buying PAN AM and all its grandfather rights to Narita.
DeleteWhether they had traffic rights to SEL or not I can't really remember. But @4:05AM is right. They flew UA807 MNL-SEL-SFO for a number of years. MNL-NRT was axed because they couldn't compete with NW. If I recall, the last MNL-NRT flights were in 1994 or 1995.
DeleteThey did flew to SEL but doesn't have traffic rights. Its similar to KLM's MNL AMS via TPE route.
DeleteAnonymous February 4, 2015 at 9:02 PM is right. And also, aside from United Airlines which provides a nonstop flight from San Francisco and Singapore, Singapore Airlines also provides a nonstop flight from Singapore to San Francisco, both of these airlines provide nonstop return flight.
DeleteIs this via Guam/Honolulu or a non stop flight to SFO?
ReplyDeleteProbably a nonstop. However, a nonstop plan from San Francisco to Manila was ended into Singapore.
DeleteIAH-MNL will work
ReplyDeleteUnited indeed had 5th freedom right to fly to MNL via SEL from SFO. This service concluded in 1998 or so.
ReplyDeleteNo they don't. By the time the rights were granted to fly SEL in 1997, UA had stopped flying MNL. While rights are granted to two American carriers NW and UA, the same is not automatic and must be applied. UA applied only NRT while NW applied for KIX, NGO, and NRT.
DeleteTo add, South Korea agreed to open Philippine markets to American carriers only in 1999 with the end of supporting ICN slated for opening in 2001.
DeleteI bet you it will be canceled again they will loose their revenue to employees and chance passengers. That's why the flight was canceled in the 90s. They were the most expensive flight to Manila from SFO and it was only employees riding their fleet. Let's see how it plays out! Most especially after the merge of United & Continental. Goodluck!
ReplyDeleteApparently they are moved by statistical data involving PAL passengers up front on J class. They are always almost full even on lean days. It also happens to be PR's most lucrative route.
DeleteBecause PAL's J fares from the West Coast to MNL are 3K USD. And sometimes as low as 1.8K if offered during travel fairs. These fares are unsustainable. If you look at flights around the world with the same stage lengths, like SFO/LAX/SEA-HKG/TPE, or HKG/SIN-Europe, the average J fare is 5K USD. Even transatlantic sectors shorter than MNL-USA command the same price. So even if US can fill the J cabin to Manila, they won't make money. This is the reason why the market is considered low-yielding.
DeleteTrue. Even in GUM PR is always cheaper than UA, yet it grew this sector almost two fold. Truth is stranger than fiction.
DeleteAnyone who thought that MNL is low yielding destination and no major airline will fly there or follow that line of reasoning, or anything like that is daft. They haven't figure what yield management is. Warren Lieberman could be of help.
DeleteAgain, look at the reply by @11:37PM. Manila IS LOW-YIELDING! If not, why did LH, BA, LX, UA (pre-CO merger) and a host of others stopped serving the city? Even KLM which used to serve AMS nonstop is now via TPE. And don't give me the b.s. that it is because of the common carrier tax. Bullocks! Don't throw around yield management crap because you haven't got a clue what that is. MNL is a long ways away from Europe/USA, and to serve this city requires the same operational costs as that to HKG/NRT/ICN/PEK or some other Asian city. But MNL commands a much lower air fare in the premium cabins because that is what the market can only absorb. Make no qualms about it, lest your ego be hurt - MNL is not a major business centre of the world, no matter how people here like to think. In the airline industry, the front end of the plane makes money, not the rear end. There is not enough demand in Manila for the front end. Even during high season, the premium cabins are full of operational upgrades! I'm a Mabuhay Miles Premier Elite member and I don't purchase J Class from the US during Christmas anymore because I'm almost always assured a free upgrade owing to my status.
Delete@5:20AM, PAL grew GUM because of Cebu Pac's impending entry into the market, just like HNL & SYD. Not because of demand. They had to defend their turf.
Delete@9:54 You get pretty close about yield management but got wromg answers in the end. Read the book and figure it out. No wonder you're not in the airline business because you can't distinguish between profits and losses. As long as your comfortable in the chair, that's it for you. I'm sorry, running an airline is not all about that. By the way, your EU airlines were on the red before they call it quits and said goodbye to the delight of CX and SQ, their partners. And yes, KLM is not about yield or the tax you said. Its about the big 3 middle east airlines.But I guess you don't know that either.
DeleteWow, so you're an expert because you read a book! Enough said! Manila IS LOW YIELDING! The ME3 don't care about yields. No matter what their leaders claim, they are heavily subsidized. Airlines pulled out of Manila because there is no demand, and whatever demand there is/was, they can't make a profit because the margins are very thin, almost non-existent! Why are the Europeans then still serving or have since returned to KUL/CGK? Some people just have no clue! They think they know it all because they read a book! What a fool! If you told me that you read WSJ, Aviation Weekly or other current publications, or even attend Routes conventions, you'd be slightly more believable. But thanks for the laugh!
DeleteNobody is claiming to be an expert here. I am just saying your argument is flawed. Daft that is. If you insists on what you believed in, then that is your opinion. Not a point of fact.
DeleteYou may think my argument is flawed, but the industry analysts agree with me, as well as the airlines themselves. Some people just get offended by the truth. Not rubbing salt in the wound here, but let me state the truth for the nth time: Manila is a low-yielding destination. You claim that it is all about yield management. Fine, go ahead and manage the yield. But at the end of the day, it is still low yield that you are managing!
Delete@ February 9, 2015 at 9:54 PM
DeleteEuropean Airlines did left other cities aside from Manila. Sydney for example, a high yielding destination, saw KLM, Austrian, Lufthansa, Air France, and Aeroflot leaving the shores of Australia in the same decade they left the Philippines. We believe some US airlines also left Sydney on the same period the Europeans left. Last year, Virgin Atlantic also left Sydney.
Those airlines leaving SYD still doesn't change the fact that MNL is a low-yielding destination. Airlines have dofferent reasons for maintaining service or not, and whatever reason they have for leaving SYD, whether it is the higher cost, competition, etc, etc... has been quantified & studied by their revenue management departments. Same with Manila, and they have concluded that it is a low-yielding destination. Why can't people accept that? Does it bruise egos? Does it hurt your feelings? Get over it!
DeleteChill dude. We are just answering your question. It is a fact. You can check other sources. High or low yield destinations really doesn't matter. If you fail you fail. VS tried SYD and it failed. It is a high yield destination yet it failed. They tried YVR and NRT also a high yield destination and also failed. UA meanwhile managed to grow its MNL network from 7 between GUM and ROR to 13. And now they are planning to make it bigger.
DeleteFunny how one can be hit by his own medicine. I'm beginning to like this 9:54PM guy. He is now justifying why the high yield route served by high yield airline failed.Clearly, he doesnt' understand airline business and yield management at all. What matter is a high yielding destination if you cannot make it work in the first place? And does it not matter if a low yield destination happen to be profitable for the airline? Yield to me is simply profit, be they high or low. High or low yield really doesn't matter. Its how you fill the plane that is important. Airline can always go to a high yield destination and go broke if they can't fill the plane. Singapore is high yielding than Dubai but Qantas left for the latter. The point being its not all about yields. So good luck arguing with this guy.
DeleteYou just don't get it do you? Yield to you is simply profit? Mama Mia! I hate to break it to you, but the airline industry is not as simple as the book you read. Have you heard of RASM and CASM? Mon Dieu! Why did KLM, who's previous daily non-stop MNL-AMS flight went out chock-a-block-full year round consistently, pulled out in favour of one-stop then? Your Qantas argument of moving from SIN to DXB is weak, because #1, they still serve SIN, and #2, that was about Australia-LHR, an ultra long-haul country/city pair that requires an intermediate stop, with a very high CASM. They are competing with network carriers in between the two countries that have lower operating costs by virtue of geography & economics. At the end of the day, they still continue to serve LHR, just from a different intermediate stop this time, and with a different partner. One thing that I'll give to you though - yes you can make a profit in a low yielding destination - but only if you have the costs of say PR, not UA and most other legacy network carriers from around the world.
DeleteWith regards to YVR, again, it is a low-yielding destination that airlines need in their network hence the bloodbath and price wars there. CX (838/839), BA & LH are all pulling or have pulled F Class out of that market. Same with JL & ANA. JL went from a 9 x a week 747 (since retired) to a daily 777, and now 767/787. It is their weakest transpacific destination. And maybe you are forgetting that VS is a struggling carrier, and has been for a long time. NRT was pulled because they have decided to refocus their routes with the resources (ie fleet) they have owing to their new partner/stakeholder DL.
While both of you have some valid arguments, they belong in the boardrooms of Cebu Pacific, Air Asia, and other LCCs, who rely less on yields and more on loads! And you're right, it is always not about yields (because some airlines need to serve those destinations for strategic & network reasons). But we are talking Manila here, so yes, it is about yields.
Oh boy! If revenue isn't profit then I don't know what is.
DeleteThe answers for KLM is right there at @6:15AM. If you don't agree with that then don't. I certainly agree with it.
And your justification for Singapore, Tokyo and Vancouver simply weakens your argument that EU legacy and US airlines don't fly to low yield destination such as MNL because it is a losing destination. That idea of yours is flawed. It is fallacy.
Further to that, you contradicted your earlier statement by saying that YVR is having a bloodbath and price war. Does it sound similar to the first argument about MNL? YVR, NRT and SYD are definitely high yield destinations.
Airlines failing due to losses can never be equated with yield issue because yield is a positive return. A revenue so to speak, or profit if you may. Notwithstanding geography, if an airline can operate it at a profit then it is yield, a positive return, no matter how low it is. If the airline is losing money out of the route then it is simply a loss. Not a yield.
UA has been operating in MNL for some time quite comfortably after its merger with CO. It has so far grown GUM and ROR from 7 to 13 flights weekly. Meanwhile PR operates GUM from 7 down to 5 times a week.
Clearly, growing the route is not meant you are losing it. That is throwing good money after bad. UA is not known for it. On the contrary, reducing flights (i.e. PR) may sound so. And if the airline is losing money (i.e. HA) then its not about the destination being low yield because yield is a positive return. It simply means the airline failed to make the market worked for them which is like the VS example given above. Profit happens to be synonymous with revenue, dividend, yield, interest and gain among other things. It is never associated with losses.
For the rest of the folks, I invite your attention to this link to have a clearer understanding about yield. I'll tell you its not rocket science. You don't need to read a book either.
http://www.aa.com/i18n/amrcorp/corporateInformation/facts/measurements.jsp
Ok all I hear from that is a lot of blah blah blah. You think my ideas are flawed. Well thank goodness you don't really matter. The airlines have spoken about Manila, and they agree with me. If it really is such a profitable city, where are BA/LH/AF/LX, etc...? Or heck, even the pre-merger UA? Perhaps they haven't read your revenue bible? Enough said. I win!
DeleteI work for UA and you will be suprised to know that some Americans would fly to MNL via HNL ang GUM just to avoid PR. Not only will it help them earn thier segments, they say that the service is better.
ReplyDeleteUA aircraft were looted overnight in Manilla. Everything that wasn't bolted down was taken
ReplyDeleteIuv this! Then I will be a UNITED Frequent !
ReplyDeleteFrom the east coast, I'll rather fly NH than UA comfort n service wise..
ReplyDeleteUnited should have gone to MNL or CEB instead of CTU (Chengdu). Who cares about Pandas, when we need to get Balikbayan boxes full of pasalubong home!?
ReplyDeleteHowever, it was replaced by San Francisco - Singapore for nonstop.
ReplyDeleteUnited Airlines planned a nonstop flights from San Francisco to Manila, but it ended into launching nonstop flights from San Francisco to Singapore, one of the neighboring and rival country of Philippines, and eventually Los Angeles to Singapore (a return flight from Singapore is also nonstop).
ReplyDelete