PAL back in black by 2014? Ang says so
MANILA, Philippines - After two quarters of being in the red, legacy carrier Philippine Airline (PAL) looks to return to profitability in 2014.
Under new management, the company cites 3 reasons for its optimism: the acquisition of new and fuel-efficient aircraft, route expansion, and the impending lifting of flying restrictions to the United States and European Union member countries
“By next year, PAL will earn money,” Ramon S. Ang, PAL's president and chief operating officer, said in a press briefing on Wednesday, March 6.
PAL Holdings Inc., the airline’s parent firm, cut its losses in the first 9 months of the fiscal year by 24%. The figure dropped to P2.74 billion from P3.59 billion because of the stronger peso. The company also reported that total revenues increased by 2.45% from P54.38 to P55.68 billion.
Ang cited the re-fleeting program, which PAL is banking on to cut its losses by half in 2013. The new aircraft would help cut fuel and maintenance cost, which accounts for 50% of operating costs.
PAL plans to fly new and fuel-efficient aircraft to its bread and butter: profitable long-haul routes.
The company plans to acquire 100 new aircraft for its major re-fleeting program. It has entered into a $10 billion deal with Airbus for the acquisition of 64 new aircraft. The new airplanes will be delivered over the next 3 years. Ang said that PAL has stopped renewing the lease contract of its old aircraft.
PAL is set to receive 16 wide-bodied A330 aircraft by the last quarter of 2013. The airplanes will be used for long-haul operations.
“We are going to use the right aircraft for the right destination,” Ang said.
The new routes bring PAL’s total number of international destinations to 33.
Lifiting of ban
Ang also welcomed the the lifting of the remaining security concerns by the International Civil Aviation Organization (ICAO) of the United Nations that had resulted in restrictions to flights it could mount to key markets, the United States and European Union member countries.
Once the bans are lifted, Ang said that the airline would offer additional flights to the US through its fuel-efficient aircraft.
The company also plans to mounts new flights to European destinations such as London, Paris, Frankfurt, Netherland, Spain, and Italy.
Tycoon Lucio Tan, the country's second richest, and San Miguel Corp. are joint owners of the airline. - Rappler.com