DOTC says Panglao still best location for airport

Despite Consultants contrary stand

By Ronnel Domingo

December 27, 2010

MANILA, Philippines—Despite opposition by civil-society groups, the Department of Transportation and Communications is keen on building a new international airport on Panglao Island instead of any other location in Bohol as based on requirements of navigational safety.

Rolando G. Tungpalan, deputy director general of the National Economic and Development Authority, said in an interview that the DOTC was reviewing the feasibility studies on the proposed airport—something that critics and even NEDA itself have asked to be done.

“The review is ongoing, but as of today [the DOTC] believes Panglao is the best possible location for the airport,” Tungpalan said. “It has something to do with the terrain and wind patterns.”

Even then, Tungpalan—who is responsible for investment programming—said there was no final and definite decision on the location yet.

In 2009, the NEDA’s investment coordination committee-Cabinet committee gave the green light to the proposed increase in the cost of the Panglao Island airport development project.

Changes in the design, increased prices of needed supplies and the acquisition of an additional 14.5 hectares of land pushed up the project cost to P7.54 billion, or 76 percent more than the original P4.27 billion.

According to the Neda ICC-CC, the project was approved on condition that the provincial government of Bohol was to conduct another multisectoral consultation to address ecological or environmental issues.

Earlier, a group of academics, lawyers and religious Bohol natives based in Metro Manila renewed its call for the government to “not rush” the planned international airport on Panglao Island as the state prepared to bid out a contract as part of a package of partnerships with the private sector.

In a letter to Transportation and Communications Secretary Jose P. de Jesus, University of the Philippines economics professor Ernesto M. Pernia said public consultations were not properly carried out and the feasibility study on the geologically unsound plan was done poorly.

Pernia, who represents the group called Concerned Boholano Professionals in Metro Manila, said there was a risk that the runway and buildings would collapse due to the sinkholes and caves, which government engineers failed to consider when they conducted a feasibility study because tests using ground-penetrating radar were apparently not done.

“We have reviewed the feasibility study done by the TCGI Engineers, the consulting firm hired for the purpose and we found the study’s quality and rigor markedly below par,” he said. “For instance, the economic forecasts are overly optimistic based on questionable assumptions.”

Is 60 too old to be a flight attendant?

By Judith Balea

December 24, 2010

MANILA, Philippines - Was the Philippine Airlines (PAL) being biased when it enforced the retirement age of 45 for its female flight attendants hired over the last decade?

Or was it just being consumer-friendly, thinking passengers might not find so appealing women in their 60s -- the prime retirement age -- serving them on board.

Labor Secretary Rosalinda Baldoz thought the former.

On Thursday, she gave members of the Flight Attendants’ and Stewardesses’ Association of the Philippines (FASAP) the best gift this Christmas by pegging their compulsory retirement age at 60, for women and men alike.

Baldoz said the different retirement ages for PAL's cabin crew, who are performing the same services, "constitute a clear discrimination of their right to equal work opportunity."

The public was quick to comment on the issue, airing out what they felt about it on social networking sites.

The tone of Twitter and Facebook posts in reaction to FASAP's sweeping win over the PAL management ranged from congratulatory, humorous to plain sarcastic.

Some users welcomed the news and said they were happy for FASAP members. Others were curious about how PAL would fare against closest rival Cebu Pacific in giving passengers the best value for their money, especially since the latter's "dancing flight attendants" were a big hit.

Here is a sampling of what they have to say about this:

"Given that DOLE's ruling sets a precedent, I demand to see 60-year-old dancing flight attendants on Cebu Pacific as well." -- Dax Lucas on Facebook

"PAL fares will go up. Cebu Pacific is happy." -- Jake Antig on Facebook

"Ballroom dancing ang gagawin nila daw. ;p" -- Stella Arnaldo

"I'm srsly dying of jealousy with the Philippine airlines cabin crew. They're soooo lucky!" -- Twitter user YumiArchie28

"Really happy for my PAL friends. Suck it, Lucio. Pay up." -- Twitter user AndrewdeCastro

"Wow, so PAL flight attendants can now work til they are 60 years old. To my friends, determining which F.A. is hottest will now be useless." -- Twitter user empylan

"BEST XMAS GIFT! :D DOLE resolves PAL row. Now - retirement age for flight attendants is 60." -- Twitter user katelopezdee

"DOLE rules that PAL flight attendants can work 'til 60. Wow! Haha. Good luck guys." -- Twitter user HecklerForever. abs-cbnNEWS.com

AirAsia Philippines to cost bus like fares

By Daxim Lucas

December 22, 2010

MANILA, Philippines—“Mr. Fernandes has to fly to another meeting in Jakarta this afternoon, so we will wrap up in two minutes,” the organizer tells reporters during last week’s press conference to unveil the joint venture deal of Air Asia in the Philippines. “Any final questions?”

The owner of the giant budget carrier politely countermands him with a casual wave of his hand: “No, it’s ok. [We’re using] our own plane anyway. It can wait.”

Local reporters—most of them seriously covering the short visit of the international celebrity to the country—erupt in a wave of laughter.

Indeed, Tony Fernandes’ mien is often compared to that other rock star of the airline industry, Sir Richard Branson.

They are both perceived as brash and aggressive, and rarely take no for an answer once they’ve set their sights on something in the field of business.

Thus, when word got around that Air Asia would start a Philippine-based airline in a joint venture deal with local partners, not a few eyebrows were raised.

After all, isn’t the global airline industry—both legacy carriers and their so-called low-cost carrier cousins—struggling due to weak demand for travel by passengers hard hit by the recent economic crisis?

And with several carriers like Philippine Airlines and Cebu Pacific already fighting tooth and nail for the relatively small number (as compared with peers around the Asean) of flyers, isn’t the Philippine market too small for a regional giant like Air Asia?

So is the local aviation industry saturated?

“Oh no! It’s anything but!” Fernandes says. “I think the Philippines has been starved for connectivity.”

To illustrate his point, he explains that he had to take one of Air Asia’s Airbus A320s out of circulation just to fly eight passengers from Kuala Lumpur to Manila at the time of his preference—a difficult decision for the cost-conscious former accountant.

For other major cities, no such private flight would have been necessary as would-be passengers could have easily booked themselves on multiple flights available throughout any given day.

“There is a massive amount of connectivity that is required in the Philippines,” he says. “If you look at Malaysia, Thailand and Indonesia, the growth [of airline passenger traffic] has really come out of low-cost carriers.”

Under the announced plan, Air Asia will start operating out of either the Diosdado Macapagal International Airport in Clark Field, Pampanga, or the Subic Bay International Airport in Olongapo, Zambales, by August 2011, with the first flight possibly coming in September.

The administrations of both special economic zones are presently lobbying aggressively to woo the new joint venture airline to make them its hub, although Clark supposedly has a slight advantage since the parent Air Asia airline already operates regular flights to and from the former US airbase.

Malaysia’s Air Asia Berhad will own 40 percent of the local joint venture, while the trio of Antonio “Tony Boy” Cojuangco, Michael “Mikee” Romero and Maan Hontiveros will own 60 percent.

Seen through local eyes, the airline’s owners are an unusual mix, but probably par for the course for the brash and aggressive Malaysian entrepreneur.

“I’ve known Tony Boy for a long time now and I’ve known Maan for many years through the music industry,” says Fernandes, whose past career includes working for a major recording company.

Most surprisingly, however, Fernandes’ decision to partner with Mikee Romero of Manila North Harbor fame is a vote of confidence for the young businessman who has been gradually stepping out of the shadow of his father, Reghis II.

“I met Mikee through basketball (Air Asia is a major sponsor of the Asean Basketball League where the team run by Romero is the defending champion), and I like his style,” Fernandes says. “He is young and aggressive. Sometimes too aggressive. If it were up to him, we would have had our [initial public offering] yesterday.”

But given that Philippine Airlines already serves the needs of more affluent travelers while Cebu Pacific is marketed toward budget flyers, what’s in it for the Filipino consumer?

The principal owners of what will be called “Air Asia Philippines” predict nothing less than what was previously thought impossible: Cheaper airfares—much cheaper than where they stand now.

“If you go to Air Asia’s terminal in Kuala Lumpur, you’ll see passengers in slippers,” says the joint venture’s chairman, Cojuangco. “This airline has been taking away business from the bus companies. That’s how cheap the airfares are.”

Company president Hontiveros also stresses that Air Asia Philippines’ operations will be patterned after its Malaysian parent: a flat organization that will keep costs to a bare minimum—with many of its ancillary services outsourced—in a move that will translate to cheaper airfare for end-users.

Amid the promises of cheaper fares, however, Fernandes believes that the best thing about having Air Asia come to the Philippines is its potential to generate more jobs for the local tourism industry.

“We can create 8,000 jobs in the Philippines, and that means 8,000 less who have to go abroad to work,” he says. “And all those jobs will also translate to more jobs in the tourism and service industries.”

Indeed, Fernandes, who professes a love for Filipino hospitality (warmer than anywhere else in the world, he says), already speaks like his interests are tied closely with those of the country’s.

“One of the key aims we have is to create more economic activity and more jobs for more Filipinos,” he says. “There’s so much talent in this country, it’s unbelievable.”

This early, it’s already starting to sound like a good partnership in the making.

Cusi Quits CAAP

Good Luck to Category One!

By Recto L. Mercene

December 22, 2010

FRUSTRATED by the constant pressure to evict him from his office despite a fixed four-year term, Alfonso G. Cusi tendered his irrevocable resignation as the director general of the Civil Aviation Authority of the Philippines (Caap) effective end of December to President Aquino.

“In spite of my four-year legal term, I submit my resignation for the sake of the Caap organization, the aviation industry and, ultimately, the country,” said Cusi in his letter. “This will give Your Excellency a free hand to choose a new director general who will continue to carry out the needed reforms in the Philippine civil-aviation industry and to whom the administration can give its full trust and confidence.”

“It has been an honor to work in government, and I will always be thankful for having been given a chance to serve the country,” said Cusi.

In Malacañang, Spokesman Edwin Lacierda issued a statement, naming Cusi’s replacement as acting OIC Ramon Gutierrez. “We welcome the resignation of Al Cusi. Now we can move faster in getting our country out of Category 2.” Gutierrez is a retired Air Force colonel and a former commercial pilot.

Cusi, since assuming the post on March 8, 2010, is leaving behind substantial progress in the government’s effort for the aviation industry to regain Category 1 status from the United States’ Federal Aviation Authority (FAA).

In 2007 the FAA downgraded the country to Category 2 status after the discovery of 89 “significant safety concerns” (SSC). Cusi had complied with the 87 SSC since taking over the post.

The last two items—organization and computerization—were within reach when the International Civil Aviation Organization (Icao) postponed its validation visit last month upon learning the Transportation and Communications department had appointed seven key officials, three of whom are outsiders, without Cusi’s knowledge.

Of the three outsiders, one voluntarily resigned, saying he is not fit for the office, while one of the remaining two had reportedly been booted out from an airline company where he used to be an executive.

President Aquino told reporters at Sofitel Hotel, where he attended the Christmas party of the Bulong Pulungan, that his choice for the next Caap director general “is qualified. He’s part of the Air Force; he’s part of the industry also. He is in private capacity already. I think he is very capable to advance the agenda as far as the air travel in the country is concerned.”

He added he wants to fast-track the resolution of the Caap problems.

But spooked by these developments, the Icao said it was postponing the visit, which would have removed Philippine Airlines and Cebu Pacific from the blacklist by the European Union, worried they would be dealing with a new set of officials.

This setback was also noted in the Icao Audit advice on their findings on the SSC and the EU blacklisting of all carriers registered in the Philippines.

Cusi has steered the Caap toward the right direction to regain Category 1 rating with no less than the president of Icao and the recent EU visit declaring that with Cusi’s leadership, the country is on the “right direction” and “it is only a matter of time” before we regain Category 1.

As director general, Cusi dedicated his efforts in transforming the Caap from a government line agency to a government-owned corporation as mandated by Republic Act 9497, otherwise known as the Civil Aviation Act of the Philippines.

A management expert, he was top honcho of the Philippine Ports Authority (PPA) for three years before he was appointed general manager of the Manila International Airport Authority (Miaa). During his six years stint at the Naia, he steered the premier airport to a point where the three passenger terminals were awarded ISO 9000, a world ranking that testifies to their conforming to international standards.

Cusi said he is keen in professionalizing the Caap, which, up to his resignation, was already training scores of people in aviation high technology, pilots, cabin crew and other highly sensitive positions. Most of the trainees were former Philippine Airlines pilots, cabin crew and experts in several fields.

Under the guidance of foreign experts from the Icao, the pilots and crew members are scheduled to undergo training at the Civil Aviation Training Center in Bicutan near Merville Subdivision.

Cebu Pacific and Online Security

Passengers Beware!

By Kevin Anthony Stoda

December 21, 2010

Am I the only one having issues and losing a lot of money trying to book tickets online--an not finding major airlines and regional airlines helpful these day?-- I look at one regional airport in Southeast.

Am I the only one having issues and losing a lot of money trying to book tickets online--an not finding major airlines and regional airlines helpful these day?

SECURITY ISSUES, DOUBLE BOOKINGS AND CEBU PACIFIC AIRLINES

Cebu Pacific's online booking system is often operating internationally illegally and unsafe--as well as passenger-unfriendly.

"MOST OBVIOUSLY by ALLOWING DOUBLE BOOKING OF PASSENGERS WITH SAME NAME AND AGES--WITHOUT ANY initial online SECURITY CHECK is only one KEY EXAMPLE of INCOMPETENT SECURITY IN SOUTHEAST ASIA. Any disguised individual could occupy the second sets of seats."--KAS

For example, this past Friday, I was "permitted" on-line with CEBU PACIFIC in a crisis this past Friday to "accidentally book myself and [pay for] two family members" 2 times on the same flight--using all the same names and credit card address.

NOTE: This occurred because the local airline I was in (in Taiwan), UNI Air, is also incompetent and failed to tell me that 3 planes were canceled on December 10--due to weather issues--from tiny Beigan Island to Taipei. This thus made it impossible at the last minute to make my December 11 (1:20am) flight to Taiwan.

Next, when a few minutes later, I understood my error with CEBU's illegally operating system (1. the online system, 2. its fax-address and 3. phone numbers in Taipei for Cebu Pacific) failed to respond to my request to not double book myself and two families--and NOT TO CHARGE MY FAMILY 10,000 PESOS twice for each December 11 booking, i.e. for 3 passengers.

CONTACT THE MANILA PHONE NUMBER, MR. STODA

After getting no help from the Taipei contact addresses for Cebu Pacific, we went to the airport. All the Cebu Pacific staff at the International Airport in Taiwan could do was to tell me to contact Cebu Pacific when I arrived to Manila.

Yesterday, I arrived in Manila with my wife and child.

NOW--TODAY--when I CONTACTED face-to-face CEBU OFFICIALS in Manila, they claimed that the company would REFUSE to refund my second or DOUBLE BOOKING of 3 passengers on December 11, 2010 from Taipei to Manila--stating the company "considered it solely the responsibility of the passengers involved when there is any online booking error."

HOW CAN PASSENGER BE SOLELY RESPONSIBLE IN A DOUBLE BOOKING?

Seaplane project in Clark gets off the ground

December 20, 2010

By Tonette Orejas

CLARK FREEPORT, Philippines—A team of 50 Filipino mechanics and engineers has started building seaplanes inside this freeport.

The amphibious aircraft is called “S-Ray 007,” said Iren Dornier, who designed the latest project of the South East Asian Airlines (Seair), the airline he chairs and co-founded with Nickos Gitsis in 1995.

“That’s a little bit of a James Bond,” he said, when asked on the famous three numbers. It is actually derived from 2007, the year Dornier first flew and landed the S-Ray prototype somewhere in the Philippines. The first five units were produced in Europe.

The Philippines, he said, is the “right environment for such an airplane,” he said, noting that the country, although with 7,100 islands, has no seaplanes at all.

He said the S-Ray 007 was designed for government, civilian, border patrol, search-and-rescue missions.

This aircraft is a “modern and bigger version” of Libelle, a flying boat that his grandfather, Claude Dornier, flew in 1921, Dornier said.

The basic version of S-Ray 007 costs $300,000. The Clark manufacturing facility targets to make 300 units. The seaplane, which weighs 825 kilograms, can carry two persons. Its wing span is 9 meters.

Among the features include a hydraulic-driven tricycle landing gear that “can be lowered inside the water to move up or down a ramp.”

“I got a few orders. The acceptance is quite high,” Dornier told the Inquirer.

To set up the manufacturing plant here, Dornier first sent to Germany at least 10 Filipinos who worked with the Clark-based Seair in the last 15 years.

In 2004, Dornier held a World Tour using the same Dornier-24 that his grandfather flew in 1944 and which had saved over 11,000 people during World War II.

The eight-month tour, done through the support of the United Nations Children’s Fund (Unicef), aimed to motivate the youth to follow their dreams. It raised $61,000 for Filipino children.

Dornier’s grandfather had built several flying boats such as the Rs I in 1915, Wal in 1922, Do X in 1929, Do.24 V/K in 1938, Do 26 in 1938 and Do 18 E in 1935. The elder Dornier also built the light fighter bomber and trainer Alpha Jet in 1973.

Regulators reject rivals’ plea to halt SEAIR-Tiger flights

By Kathleen A. Martin

December 20, 2010

THE CIVIL Aeronautics Board (CAB) has allowed a partnership between South East Asian Airlines (SEAIR) and Singapore-based Tiger Airways to proceed despite complaints from four local carriers.

CAB Executive Director Carmelo L. Arcilla said the carriers’ request to issue a cease-and-desist-order against SEAIR-Tiger Airways flights to Singapore from the Clark airport over legal questions was not granted.

“The matter is undergoing due process already and it will be set for a hearing,” Mr. Arcilla told yesterday.

Mr. Arcilla said that after four local carriers, namely Philippine Airlines (PAL), Cebu Pacific, Air Philippines, and Zest Air, filed a consolidated opposition to the SEAIR-Tiger Airways deal last month, SEAIR was asked to comment. The four carriers are claiming SEAIR is allowing a takeover of a foreign airline in the guise of a marketing and leasing deals.

“The first step was to furnish the respondent a copy of the complaint and ask them to comment on the allegations, and now that SEAIR has responded, it will be set for hearing,” Mr. Arcilla said.

Mr. Arcilla said a hearing will “probably be scheduled next week,” as this will be the next step in the process.

In a letter dated Dec. 9, PAL wrote on behalf of the other carriers to CAB Chairman Glicerio V. Sicat, reiterating their opposition to the partnership first raised in a letter to the board last Nov. 26.

“We believe that we are raising compelling questions on whether the SEAIR/Tiger service may not actually be a Philippine carrier operation, but instead the first salvo of a foreign (Singaporean) air carrier operating a Philippine-based international route network in the guise of a Philippine air carrier, and making use of Philippine carrier international traffic rights privileges,” Ma. Socorro R. Gonzaga, PAL senior assistant vice-president for external affairs, said in the letter.

“Indeed, the operation may be expanded to include domestic routes as well, raising likewise the question of effectively granting regular cabotage access to a foreign airline for the first time in [Philippine] history,” Ms. Gonzaga added.

The four carriers are pointing to CAB Resolution No. 51, which prohibits Tiger Airways from directly earning money from the partnership with SEAIR.

SEAIR and Tiger Airways announced the partnership in a joint statement last Nov. 23. Under the deal, two Airbus aircraft will be leased to SEAIR, and SEAIR seats will be distributed through Tiger Airways’ Internet booking system.

The first SEAIR-Tiger Airways flight from Clark to Singapore last Dec. 16 pushed through.

In a phone interview, SEAIR President Avelino L. Zapanta, said the complaints of the four local carriers were only a “rehash” of what they had filed in 2007, when SEAIR and Tiger Airways first sought to seal a partnership. The deal did not push through amid a global economic slowdown.

“In 2008, the case was dismissed in favor of SEAIR,” Mr. Zapanta said. “These are the same speculations and allegations three years ago and they have not come up with any new evidence,” he said.

PAL spokeswoman Cielo C. Villaluna said: “There is simply a concern regarding overcapacity and a possible price war among airlines. But PAL, as an airline, welcomes competition.” -- Businessworld

Local Airlines hit SEAir, Tiger partnership

Deal seen violating Constitution
By Paolo Montecillo

December 20, 2010

MANILA, Philippines—The Philippines’ top airlines are protesting the allegedly illegal “partnership” between Singapore’s Tiger Airways and local Southeast Asian Airlines (SEAir).

The arrangement between the two airlines, wherein SEAir flights—using aircraft leased from Tiger Airways—will be sold on the latter’s website, allegedly skirts a constitutional restriction on the foreign ownership of companies in vital industries.

In a letter to the Department of Transportation and Communications (DOTC), copy furnished the Civil Aeronautics Board (CAB), Philippine Airlines (PAL), Cebu Pacific, Zest Airways and Air Philippines called for an investigation of the operations of SEAir and Tiger.

“We earnestly request that the board launch a full and exhaustive investigation into the matter for the purpose of ascertaining, among others, that the marketing agreement entered into between SEAir and Tiger is in strict compliance with the terms of the CAB,” said the joint letter obtained from the CAB.

In its own letter to DOTC Undersecretary for Civil Aviation Glicerio Sicat, PAL said, “It is becoming apparent that Tiger has a direct stake and participation in the success of the new venture.”

“It is noted that all four Philippine international air carriers took the unprecedented step of filing said consolidated opposition, in which we jointly requested the [CAB] to issue a cease-and-desist order directing SEAir and Tiger to stop selling and promoting the planned Clark-Singapore flights,” the letter dated December 9 said.

The Constitution prohibits foreigners from owning more than a 40-percent stake in companies in industries such as transportation and telecommunications.

The four airlines in their letter asked the regulator to investigate “the matter to determine if the SEAir and Tiger activities and operations fully comply with Philippine laws, rules and regulations.”

The airlines added that Tiger Airways’ plans to put up an operating base in Clark Freeport in Pampanga, through SEAir, would disregard and undermine Philippine laws, to be achieved through a form of “regulatory sleight of hand.”

SEAir officials could not be reached for comment as of press time.