Airlines In The Philippines II

[Solblanc]

Hmmm, interesting news...

On the A35K, one has to wonder, if they’re going to wait and see, what happens to the A350 options? Will they just let them expire? And if they are indeed going to hold on to the 77Ws, will they just bite the bullet and refurbish them already? It’s really bizarre that you have W class to BKK and HKG but not to their biggest markets of LAX/SFO where W class can really make money.

And as for TG, they did serve BKK-MNL-KIX once upon a time. The 5th freedom rights were always there.

On the Thai end, their speculation is all well and good, but they still have to get Category 1 from the US FAA to resume US ops, and they failed their last audit, if I recall correctly, so they aren’t going to give transpac access to CEB or CRK anytime soon, so that might be just wishful thinking from GMR.

On the Philippine side, PR was last using the BKK 5ths for the terminated MNL-BKK-DEL service. But PH carriers don’t seem interested in getting into the bloodbath of capacity in BKK. Heck, 5J could’ve made use of the Thai 5ths to expand to India, or add a spoke to Singapore, but that hasn’t happened. I wonder if something will change.

The AA rumour has been floating around for a while. There was even that tweet by JonNYC that confirmed they were thinking about it. If anything is stopping them, it’s most probably the lack of MNL slots, and it doesn’t help that DL is still hanging on to their slots even after closing NRT.

[Arianespace]

Well yes the 5th freedom is still there. The better question is how you make it work from both ends? At its latest usage, both PR and TG failed to make it work. Jetstar is however making headway both at MNL and CRK to KIX.

As to AA, they don't have DOT permit to fly PH. Allowed airlines per ASA are DL,UA, and HA. PR and HA codeshare so technically they are still flying. There are only 3 airlines allowed in ASA. This is the same reason why Z2 application to GUM was denied and 2P was forced to fly GUM. They must wait for CEB to surrender theirs but will they?

[Evodesire]

PAL management including the President is at Boeing checking the 777-9X. Lease of 7777 and 7776 set to expire soon. They should have their eyes on the A35K by now, hopefully.

[romantic_guy08]

Sad to hear of the shocking and untimely passing of Bong Tan...

[arema]

^^
I am shocked as well. Just read the news a few minutes ago.

[Arianespace]

He was so active and healthy to say the least. He was playing for PAL in a basketball game Saturday before he collapsed. See video here. Condolences to Tan and Gokongwei family.



John Paul Manahan tweet hits the dot.

[Eurest]

Historically speaking it seems PR does maintain ties with lessors even as the fleet gets refreshed

Leases A320 from GECAS in 2006, leases A321 from GECAS in 2018 with a subordinated debt from PK AirFinance (before GECAS sold it) for acquisition as well as spare engine
Assuming the same standard 12 year lease deal, a 2021 lease deal for 2 779 is highly plausible based on historical evidence.

I doubt the lease on the first 2 B77W will be extended with all the efficiency improvements not just on new a/c but later built B77W as well
The only thing is, Mr. Sta. Maria was not the President during these deals and would he be as willing to expose add'l equity for more subordinated debt to finance the acquisition?
Especially if they are aiming for profitability in 2 years, they may just delay to FY 2022

GE would very much like PR to choose the 779 as it is very wary of the inroads RR has in the PH aircraft powerplant market and PR really does need the volume in Y as well as belly cargo for ULH
But with the delays to the 777x program, can PR get 1 of the first few now slated for 2021/2022 to replace the first B77W?
It does help that LH converted 14 firm to options

As for AA's PH ambitions, the US DoT will ultimately be the one to decide if it can push through since the PH is under an ASA.
But hiring Delta's old MNL base manager, that HA even hired to help their MNL ops doesn't that raise your eyebrow? Especially with that person's experience in starting base ops
Perhaps this is one of the many reasons why DL still flies MNL, not just the gov't contract, nor the cash cow it becomes during XMas and 2Q of the FY, but to ensure market share in Asia

With the successors untimely passing, and consolidation in ASEAN carriers seemingly starting with the SQ-MH strategic partnership, is PR ripe for a strategic investor to take it and another ASEAN carrier for a partnership ala SQ-MH or perhaps even a AFR-KLM endeavor?

[Evodesire]

Eurest wrote

I doubt the lease on the first 2 B77W will be extended with all the efficiency improvements not just on new a/c but later built B77W as well
The only thing is, Mr. Sta. Maria was not the President during these deals and would he be as willing to expose add'l equity for more subordinated debt to finance the acquisition?
Especially if they are aiming for profitability in 2 years, they may just delay to FY 2022

GE would very much like PR to choose the 779 as it is very wary of the inroads RR has in the PH aircraft powerplant market and PR really does need the volume in Y as well as belly cargo for ULH
But with the delays to the 777x program, can PR get 1 of the first few now slated for 2021/2022 to replace the first B77W?
It does help that LH converted 14 firm to options

If PR would exercise the 6 A350 options and go for the A35K as replacement for the 2 77Ws, how fast will they be able to get them. Arianespace has been always reiterating that the A35K will be a great complement to the 77W.

[Arianespace]

I think it was already established that A35K and B77x are two different planes PAL is willing to invest in the future. But for now it will settle with the options. If I remember correctly, Airbus can give them the plane in 10 months time after contract signing.

The logic seems to be that 77x is quite big while 359 is a little bit small. They need plane in the middle and 35k fits the bill perfectly. Interestingly, the person who said that is the one who chose and fetch the A359. And his not even President. His here and still around.

[Arianespace]

Eurest wrote

As for AA's PH ambitions, the US DoT will ultimately be the one to decide if it can push through since the PH is under an ASA.

But hiring Delta's old MNL base manager, that HA even hired to help their MNL ops doesn't that raise your eyebrow? Especially with that person's experience in starting base ops

Perhaps this is one of the many reasons why DL still flies MNL, not just the gov't contract, nor the cash cow it becomes during XMas and 2Q of the FY, but to ensure market share in Asia

What US airline do you think would be eased out for AA? Remember only 3 airlines are allowed to fly in the ASA. And for whatever its worth good luck obtaining the slots at MNL.

With the successors untimely passing, and consolidation in ASEAN carriers seemingly starting with the SQ-MH strategic partnership, is PR ripe for a strategic investor to take it and another ASEAN carrier for a partnership ala SQ-MH or perhaps even a AFR-KLM endeavor?

One major distinction on that equation we seldom missed is that PAL is privately owned, while both SQ and MH are government owned. Even Thai and Garuda are owned by taxpayers.

[Evodesire]

Arianespace wrote

 Interestingly, the person who said that is the one who chose and fetch the A359. And his not even President. His here and still around.

I see Michael Tan in the middle...

[Evodesire]

With the untimely passing of Bong, who do you think will take over PAL Holdings as President? Will it be MT or VT?

[Solblanc]

Six options won't be able to replace the capacity of ten 77Ws though. Either PAL increases the order to 10, which would be a win for Airbus, or they source the shortfall from Boeing with the 777x. A mixed fleet is still possible.

[Arianespace]

Everyone's guess is good as mine. I think eventually it would all be Michael. He is first born. In Chinese it means you are the next in line. Bong is no 2 and Viv is no 3 and two of her other sister is 4 and 5.

Solblanc wrote

Six options won't be able to replace the capacity of ten 77Ws though. Either PAL increases the order to 10, which would be a win for Airbus, or they source the shortfall from Boeing with the 777x. A mixed fleet is still possible.

I never said they won't order Boeing. What I said was they will exercise the options first.

[Unknown]

Well, comparing LTjr and Michael, pabor ako kung si Michael sa pagkadeplomasya magsalita, the way am personally experienced both of them, when our company have contract with the Tan's family companies/residences including LT house back of Santo Domingo Church in QC which nearer to our office...

[Arianespace]

This is going to be more interesting.

https://www.flightglobal.com/news/articles/united-airlines-protests-pal-express-and-pal-codesha-462373/

I was previously talking to AA's chances of acquiring MNL slot should they be awarded DOT permission to fly. Well, UA has the same problem. And they are already here.

United currently operates one daily direct flight between the US territory in the Pacific Ocean and the Philippine capital, and would like to add another daily connection. However, it says it has been denied “slots and other airport infrastructure necessary for its additional flight plans.”

The truth, it was not denied. They were asked to look for another time since the time they requested is already full. ANZ also did the same thing but cannot find suitable time so PAL flew instead. It could always fly Clark or Cebu. But it wanted to fly MNL.

By the way, the time offered to them was eventually given to a Chinese carrier because they won't compromise on the supposed applied slot.

[seven13]

This seems like CZ’s 4th rotation on MNLCANMNL. Arrival Manila around 2am or 3am

[fd20]

There's a new thread on Airliners.net discussing a possible SFO-MNL flight by UA. I think the OP might have just misinterpreted the "United currently operates one daily direct flight between the US territory in the Pacific Ocean and the Philippine capital, and would like to add another daily connection" statement in the article - there was never any mention of any mainland US-MNL flight. In true Airliners.net fashion, the responses to the thread were overwhelmingly negative - the usual stuff about MNL being low-yielding and the Philippines being an "extremely poor country".

Still, though, is there any chance we'll ever see a mainland US-MNL flight from either AA/UA/DL? UA's SFO-MNL flight has been rumored for a long time now, along with DL's LAX/SEA-MNL.

[Arianespace]

The rumors are actually true. The problem I was told is securing the desired slots from Australia's Slot Coordination (ACA) for UA's SFO flight in MNL. Its even older than LAX-SIN application and they are now flying there. If I'm not mistaken, the application was the source of that rumor. Slot refers to both Terminal and runway use. While they have the runway they don't have a gate.

DL has the best shot for LAX and SEA because it already has the slots which it did not surrender. CAB wanted to cancel those unused slots a long time ago but was constrained by PAN AM "Grandfather" rights. In common parlance, it means inheritance. I was hoping they would change their mind after giving up NRT. But direct flight is not yet on DL's immediate plan. So we have an airline wanting to fly with no slot and an airline who doesn't fly but has the slots. I'm not inclined to believe they will lease those to competitor.

If you might wonder where those slot come from

[Anon]

NW used to fly from Narita, Nagoya and Kansai.