PAL To Fly Another Repatriation Flight To Lebanon

24 September 2020

Flag carrier Philippine Airlines (PAL) will fly another repatriation flight to Lebanon tomorrow, but this time will bring 5,000 boxes of relief packages from the Philippines to Beirut to help the nation devastated by port explosion and economic turmoil that plague the country.

Part of the relief goods will come from the Lucio Tan Group of companies, which consists 3,000 boxes of surgical masks, 27,500 face shields and 1,000 boxes of Vitamin C.

The DFA-chartered B777-300ER (RP-C7778) flight (PR8680) is expected to bring home around 300 distressed Filipinos from Lebanon on a 12 hour journey. The repatriation team will be led by Chief of Presidential Protocol and Presidential Assistant on Foreign Affairs Robert Eric A. Borje.

Air Travel Plunges 63% In First Half

 Registers only 11.3 Million Passengers

 

23 September 2020

Air passenger traffic volume in the country plunged by 63 percent from January to June this year, government data showed.

According to the Civil Aeronautics Board (CAB), the country’s passenger volume stood at 11.3 million in the first semester, compared with 30.5 million passengers flown in the same period last year.

The government regulator attributes the fall to covid19 pandemic which resulted to closures of airports and restrictions on travel between the months of March and June this year.

CAB Executive Director Atty. Carmelo L. Arcilla disclosed that majority of the recorded passengers flew between January and March 15. Less than 500,000 passengers flew between March 16 and June 30.

The domestic market recorded 5.99 million passengers, 61 percent down from 15.2 million passengers flown a year ago.

International traffic stood at 5.3 million, 65 percent lower than last year’s 15.3 million passengers. Of the total, 2.8 million passengers flew via the domestic carriers and 2.5 million through the foreign carriers.

CAB said some of the passengers were stranded and repatriates OWFs and LSI who returns to the country and their place of residence in the countryside after the suspension of commercial flights from March up to June.

Office of Civil Defense registers more than 300,000 of affected airline passengers that was carried by government sponsored airlifts, both made by military planes and chartered flights by local airlines.

CEB Leads Domestic Traffic, PAL Leads International Services

Cebu Pacific (CEB) and its subsidiary Cebgo leads the domestic carrier having flown 3.9 million passengers in the six-month period, down 63 percent from last year’s 10.6 million passengers. Of the total, 3 million passengers took domestic flights and 811,902 for international flights.

Meanwhile, flag carrier Philippines Airlines (PAL) and subsidiary PAL Express, leads in the international market with 3.1 million passengers served in the first six months, of which 1.5 million flew international and 1.6 million took domestic flights.

Low-cost carrier Philippine AirAsia flew 1.6 million passengers in the first half of the year, of which 1.22 million passengers took domestic flights and 370,484 international flights.

PAL To Fly All Cargo Flights To The US

23 September 2020

Flag carrier Philippine Airlines (PAL) will fly six no-seat passenger flights of B777-300ER planes to Los Angeles and New York in the United States beginning October 2020.

The airline will transport cargoes consigned to Unique Logistics (ATL) for delivery to American market from Vietnam and the Philippines.

Unique Logistics, is a global logistics and freight forwarding company based in New York.

Lance's Dilemma

It's A daunting Challenge

22 September 2020 

Cebu Pacific (CEB) Chief Executive Officer Lance Gokongwei was interviewed by Forbes magazine released last week on how he manages Cebu Pacific and Covid 19 Pandemic. This is the excerpt of that story prepared by Sonny Thakur for Forbes Asia. 

The airline lost 9 billion pesos in the first half of the year versus 7 billion of net profit it booked earlier. To reverse the tide, the CEO made drastic move to cut losses.

"It’s a daunting challenge," said Lance Gokongwei. 

Following a three-month lockdown in parts of the country, Cebu Pacific remains almost completely grounded, operating at about 2% capacity versus a normal 75%. Cebu Air’s revenue in the first half of the year slumped 61% from a year ago to 17 billion pesos. 

“You just cannot operate in an environment where you have four months of zero revenue. And foreseeably for the next—we don’t know—four, six, eight months, one year, there [will be] no revenue,” Gokongwei says. “There is no economic model for that.” 

Gokongwei’s rescue plan? So far, he has laid off about a quarter of the airline’s staff (about 1,000 employees) since mid-March, scaled down the airline’s operations and shelved expansion efforts. 

To save cash, which halved to 9.7 billion pesos on its books in the first half, Cebu Air will cut capital expenditure by more than 70%, to 8.3 billion pesos, this year. 

To further trim costs, it has sent 14 of its 77 planes for storage in Australia. “We’re preparing for a much smaller future,” says Gokongwei, projecting the airline will operate at half its previous capacity by mid-2021 and won’t recover completely until 2023 at the earliest. 

The company is also preparing to raise fresh funds, he says, but declined to disclose details. 

Meanwhile, Gokongwei wants to get more Cebu Air’s planes flying, and has been enticing customers with discounts. 

But in early August, Manila’s main airport closed unexpectedly for two weeks—a disruption that Gokongwei shrugs off as the new normal. 

“You have to work in a very agile way,” he says.

PAF Receives New Assets

20 September 2020

The Philippine Air Force (PAF) will receive delivery today of new Gulfstream G280 (RP-1251) Presidential jet from the United States and six A-29B Super Tucano attack aircraft from Brazil.

The PAF signed a foreign military sales contract with the US government to purchase the G280 jet including parts, tooling, and logistics support, for $36,999,916, (P1.9 billion) from Gulfstream Aerospace Corporation in October 2019. 

The new jet is intended to replace and retire the Fokker F28 jet used for VIP Transport. It will also be used for command and control, the G280 can also be used in airborne early warning, medical evacuation, high-altitude atmospheric research, and intelligence, surveillance and reconnaissance (ISR) missions according to DND.

The G280 has a maximum range of 3,600 nautical miles/6,667 kilometers at its long-range cruise speed of Mach 0.80 and a high-speed cruise of Mach 0.84. The aircraft can fly eight hours nonstop, according to Gulfstream.

Meanwhile, the six close-air support aircraft is intended to beef up the Philippine Air Force (PAF)'s close-air support capability for light attack, surveillance, air-to-air interception, and counterinsurgency missions. It was ordered in 2017 with a price tag of 4.968 billion pesos, intended to replace the ageing North American Rockwell OV-10 Bronco fleet and SF-260 attack planes. Super Tucanos will be part of the 15th Strike Wing.

Department of National Defense (DND) spokesperson Arsenio Andolong said the six initial aircraft have all landed in Clark Air Base this morning from the company airfield in Sao Paulo, Brazil, and made fueling stops in the Canary Islands, Portugal, Malta, Egypt, the United Arab Emirates, India, Bangladesh, Thailand, and Vietnam before landing in the Philippines in batches of two flown by Embraer company pilots.

Andolong said Embraer pilots will train PAF pilots selected to fly the "Super Tucano" in Clark for two months as part of the agreement under the Technical Inspection and Acceptance Committee.

In addition, another batch of 16 S-70i Blackhawk Helicopters are also under way for delivery to the country to meet the PAF’s separate ‘combat utility helicopter’(CUH) programme. The first six helicopter will be delivered in the fourth quarter of 2020, with remainder scheduled for 2021. The helicopters are being manufactured at PZL Mielec, Sikorsky’s company in Poland.

PAF Air Ambulance Down

17 September 2020

A Philippine Air Force (PAF) S-76A air ambulance helicopter crashed in the mountains of Lantawan, Basilan killing two pilots and two crews on board yesterday afternoon.

The helicopter belonging to the 505th Search and Rescue Group departed from Edwin Andrew Air Base (EAAB) at 12:33 p.m. was heading to Jolo, Sulu, for a medevac mission when it crashed in Upper Manggas, Lantawan.

Lantawan Municipal Administrator Tahira Ismael-Sansawi said the helicopter was trying to gain altitude and fly away from bad weather when it was caught in the middle and was suck downwards, in a weather phenomenon known as "downdraft".

"Nakita ko po hinihila siya pababa ng hanghin tapos bumagsak at sumabog," says the former Mayor of Lantawan.

The administrator said Lantawan is suffering bad weather and strong winds before the crash up to this time due to Habagat.


This S-76A Sikorsky helicopter was acquired by the PAF in 1983, and delivered to the Philippines in 1984 performing gunship air support roles before it was relegated to ambulance service in 2011.

PAA In Race For Capital Infusion

As AirAsia Reports Local unit lost ₱2.3B

17 September 2020


The Kuala Lumpur-based low-cost airline said its Philippine AirAsia unit will be availing the loan accommodations provided by the Philippine government under the Bayanihan Act II. 

AirAsia Berhad said it has applied for bank loans in its operating markets, and that the regional low-cost carrier has been presented with proposals from investment bankers, lenders and potential investors to raise capital.

The airline group is seeking to raise as much as 2.5 billion ringgit ($600 million) by the end of the year as it tries to survive a business slump exacerbated by the coronavirus pandemic.

The group said Philippine AirAsia unit lost ₱2.3 billion in the second quarter of the year, wiping out the ₱1.87-billion profit the local carrier posted last year.

Majority stockholder Michael Romero said that after last year's reorganization, the airline was seeking to raise around $200 million this year or in early 2021, and that it had already tapped Citibank and BDO Capital as financial advisors for the planned initial public offering of Philippine AirAsia.

Romero said the plan will have to wait as his airline is “in active engagement” with its creditors to reschedule payments and reduce costs as well as to renegotiate terms of contracts as it tries to survive the pandemic.

The airline said the number of passengers it carried fell 99 percent in the second quarter from a year ago due to the travel restrictions brought about by the COVID-19 pandemic.

PAA said passenger volume reached only 29,111 in the April to June period, down from 2.22 million passengers it flew in the same period last year.

The airline hibernated its fleet from March 20 to June 4 because of the COVID-19 outbreak.  Load factor fell by 36 percentage points to 55 percent from 91 percent.

“For the fourth quarter this year, AirAsia Philippines is targeting a recovery of domestic capacity up to 60 percent of pre-Covid-19 levels,” the company said.

Air Asia resumed limited domestic and international commercial flight schedules after Metro Manila reverted to the general community quarantine.

Government Allocates ₱700M To Airline Relief

16 September 2020

The Government of the Philippines has allocated about ₱700 million as initial aid to Philippine-based carriers affected by the covid19 pandemic, after the Bayanihan to Recover as One Act (Bayanihan II), was signed by President Rodrigo R. Duterte on Sept. 11.

Bayanihan 2 provides a ₱165.5 billion fund, including ₱140 billion in regular appropriation with ₱25.5 billion in standby funds.

Congress has set aside ₱9.5 billion for the recovery programs of the Transportation department. Of that amount, ₱2.6 billion is dedicated to assist the critically hit businesses in the transportation industry.

Credit accommodations will be provided by Land Bank of the Philippines and Development Bank of the Philippines, both government financial institutions (GFI) that will guarantee the loans.

Secretary Arthur Tugade disclosed the funds provided to support airlines are not bailouts but government guarantee of the loans they will secure from GFIs.

The Transport Department (DOTR) said the Bayanihan II law directs them to “provide direct cash or loan interest rate subsidy” and “grants for applicable regulatory fees.” The department is likewise directed to “allow substitution of refund option to travel vouchers, provide grants for fuel subsidy and/or digital fare vouchers, as may be necessary.”

According to Air Carriers Association of the Philippines (ACAP) Executive Director and Vice-Chairman Roberto C.O. Lim, each airline is expected to receive about ₱140 million loan assistance under the current law this year.

Lim supported Secretary Tugade's claim that it is not bailout but assistance to airlines in need, as he explained that DOTR is mandated by law to waive fees.

“That will be a good assistance. ACAP carriers pay around ₱500 million per month in fees. A waiver as distinguished from deferral will help,” Mr. Lim added.

ACAP is composed of Philippine Airlines, Inc. (PAL), Cebu Air, Inc. (Cebu Pacific), Philippines AirAsia, Inc., Air Philippines Corp. (PAL Express), and Cebgo, Inc.

Mr. Lim said that air, land, and sea sectors are expected to get around ₱700 million each.

Small independent airlines will also be beneficiary of this stimulus package says Tugade.

A separate ₱10 billion economic stimulus package under the ₱1.3-trillion Accelerated Recovery and Investments Stimulus for the Economy Act (ARISE)is pending in Congress for approval.

ARISE sought to create a sovereign wealth fund for investment in the airline industry.

Department of Finance (DOF) official said the proposed Accelerated Recovery and Investments Stimulus for the Economy (ARISE) bill cannot be funded this year.

Finance Secretary Carlos Dominguez III said ARISE could be implemented next year because this measure will exceed the financing program set by economic managers.

The House of Representatives earlier approved the ARISE bill, which needs about ₱1.3-trillion budget. The Senate’s version, in turn, requires about ₱140 billion.

Dominguez however cautioned legislators on the approval of stimulus measures that the government cannot finance or are unsustainable, as these will just push the government’s budget gap wider.

“What we cannot fund for borrowing is additional spending over and above the budget and, by the way, in our borrowings, we have done it very conservatively,” he said.

“We have achieved very low rates and we have achieved extended terms. So, that is the situation that we are at and people should understand that is a constitutional limitation.” he adds.

For this year, Dominguez said that the government can finance a budget deficit of up to 9 percent of GDP, which will put the country in the median of comparable countries in Southeast Asia and East Asia, among peers with similar credit ratings, and among other emerging market economies.

The DOF said decisions for the provision of the credit should not only be coursed through Departments but determined and managed solely by government financial institutions, which “possesses the expertise on such functions rather than the various executive agencies with different mandates.”

Dominguez also disclosed that government will be infusing more capital to government financial institutions, such as Land Bank of the Philippines (LandBank), the Development Bank of the Philippines (DBP) and the Philippine Guarantee Corp., to enable them to assist micro-, small- and medium-enterprises and other companies affected by the pandemic.

“Right now we are suggesting that the Landbank of the Philippines and the Development Bank of the Philippines organize a new GOCC [government-owned and -controlled corporation] that will be capitalized and will be empowered to make investments in companies that are that important to the national interest and that need injections of capital in the form of preferred shares, in the form of ordinary common shares or whatever,” he said.

8 September 2020


Philippine Airlines (PAL) is named among the world’s top 10 safest airlines for travel during the current coronavirus pandemic, according to a newly released database by Safe Travel Barometer.

Safe Travel Barometer looks at COVID-19 traveler health and safety protocols for over 150 airlines.

PAL was listed as the ninth safest airlines in the world as of August 31, with a “Safe Travel Score” of 4.2 out of 5, a score held also by Hawaiian Airlines, Airasia Malaysia, and China Airlines.

Number one on the list was Germany’s Lufthansa Airlines, which received a score of 4.5. At the end of the list was Saudi Arabia’s Nesma Airlines with a score of 1.

Cebu Pacific, meanwhile received a score of 3.2 out of 5 on the comprehensive list.

PAL Trims 35% Of Workforce

 7 September 2020

Flag carrier Philippine Airlines (PAL) disclosed over the weekend that it will implement another round of voluntary and involuntary manpower reduction starting October.

PAL presented its survival plan last week to its employees dubbed as "Project Gamma," calling for reduction of workforce by another 35 percent starting October.

The airline said it will let go of at least 1,800 people, both from ground and flight crews to keep their company afloat in this trying times.

PAL earlier implemented a five percent manpower reductions of its workforce last March as it let go 300 people, 200 of which were retrenched while another 100 opted for early retirement.

Project Gamma calls for PAL management to communicate with all concerned employees in the first half of October and offer them a voluntary separation program. It would also process voluntary separation requests. By second half of October, PAL will then process requirements for involuntary manpower reduction. This involves the processing of involuntary separation packages and the provision of employee support through outplacement services.

PAL said the airline would provide “severance pay that we can afford.” It will also comply with all the requirements of the Labor Code to ensure fair process in involuntary separation.

The airline earlier negotiated with aircraft manufacturer Airbus for deferred aircraft delivery schedules, as well as to different aircraft lessors for concessions on lease terms, including pre-termination of some lease contracts on planes.

PAL also secured 20% reduction of its contract for ground services from sister company Macro Asia and another undisclosed discounts for its fuel delivery costs from Petron Corporation.

The company saw losses widen to ₱20.93 billion from January to June this year versus ₱3.33 billion during the same period in 2019. Its revenues mostly coming from passenger ticket sales, fell 54.7 percent to ₱36.82 billion in the first semester of the year, according to its disclosure the the Philippine Stock Exchange.

Air Asia Confirms Zamboanga, Dadiangas Flight

4 September 2020

After a six month delay brought by covid19 pandemic, AirAsia Philippines (AAP) will continue its plan to expand its network in Mindanao, by adding Zamboanga and General Santos to its route network beginning October 25.

While the earlier flight plan in March calls for Clark-Zamboanga-Clark and Clark-General Santos-Clark, this time around it will be Manila-Zamboanga-Manila and Manila-General Santos Manila, after the airline secured slots in Manila.

AirAsia Philippines chief executive officer Ricardo Isla said the carrier hopes to help stimulate economic activity, allowing businesses to recover and thrive.

Manila-General Santos flight is scheduled to be flown thrice a week while Zamboanga will be flown twice a week.

AAP has mounted multiple chartered flights to Zamboanga and General Santos, transporting passengers and cargo to and from the carrier's hubs, according to Isla.

Isla added that having flights in these routes is a timely response to the demand as they are able to acquire landing slots of this routes.

Zamboanga International airport only opens commercial flight every Monday and Thursday, while charter flights are flown everyday.

PAL Flies Lebanon

To Bring Filipinos Home

4 September 2020

Flag carrier Philippine Airlines (PAL) mounted a chartered Boeing 777-300ER (RP-C7778) flight to Beirut, Lebanon to ferry stranded Overseas Filipino Workers (OFWs) back home.


The Department of Foreign Affairs (DFA) said it repatriated 361 OFW's to Manila from Beirut that were both displaced from covid19 pandemic and the blast explosion that rocked Beirut last month.


“PAL flight PR8680 departed Manila on September 2 and arrived in Lebanon's capital city after a 12 hour 9 minute journey” the airline said.

“After a two-hour ground stop and passenger boarding at Beirut's Rafic Hariri International Airport, the flight took off for its 12 hour 9 minute journey to Manila and landed around 8:11 p.m. on Thursday, September 3.,” it said.