Airlines In The Philippines III

[Evodesire]

I received news that APG has been contacting and sending messages to aviation bloggers to take down the news about the fate of their Davao flights. They are trying to reach out to Aeroroute to take it down. They are saying that it's false news, but when I tried to book a flight from Manila to Davao beyond January 22, 2025, I couldn't.

[JNC03]

That is what the airline doing, deleting the negative news amid the messy situation of Z2 internally

[Evodesire]

"Flag carrier Philippine Airlines (PAL) sustained a 55-percent drop in its profit in the nine months to September, dragged by declining passenger revenues and spiking aviation costs.

PAL’s parent PAL Holdings Inc. reported yesterday that its net income fell by more than half to P6.76 billion between January and September, from P15.16 billion a year ago."

https://www.philstar.com/business/2024/11/13/2399633/pal-profit-down-spending-spurt

"PAL is PAL" they say. "No matter what, Filipinos will fly us", they say.

[seven13]

I wonder if someone from the management/BOD is surprised with their financial report. Sinasampal ka na nga harapharapan pero sige pa din.

You reduce your network and frequent AOG and delays/reschedule of flights, passenger compensation or transfer + hotac. No cost rationalization can save their expenses from all its operation problem.

It really baffles me how come T'way can operate ex-CX's B777 with FCL (or other available aircraft in the market) but PR is unable to do so just because it does not fit their cost structure. I remember Stan saying this some years ago when revenger travel was at its peak.

[Solblanc]

 
Well, if Air Asia X can make PAL’s premium A330s work while PAL themselves gutted them…

[airline_builder]

https://media.licdn.com/dms/image/v2/D5622AQEUac1JBncv6A/feedshare-shrink_2048_1536/feedshare-shrink_2048_1536/0/1731485492624?e=1734566400&v=beta&t=errKXHoysNXEHUlCvh0HSXDtD2MCBprc8wDlVWFBvyI

are these the seats for the A321ceos hidden behind the photo ops at Tanuan Batangas Collin Aerospace

[Evodesire]

These will be for the BCL of their A35Ks. I am still not digging their 3-4-3 ECY config though.

[Evodesire]

seven13 wrote

I wonder if someone from the management/BOD is surprised with their financial report. Sinasampal ka na nga harapharapan pero sige pa din.

You reduce your network and frequent AOG and delays/reschedule of flights, passenger compensation or transfer + hotac. No cost rationalization can save their expenses from all its operation problem.

It really baffles me how come T'way can operate ex-CX's B777 with FCL (or other available aircraft in the market) but PR is unable to do so just because it does not fit their cost structure. I remember Stan saying this some years ago when revenger travel was at its peak.

Realistically speaking, this is how the local market sees our local airlines:

Cebu Pacific = low fares, new planes
AirAsia PH = lowest fares, old planes
PAL = expensive fares, old planes, crappy inflight amenities

So you now would not wonder why PAL's financial position is down.

Maybe Arianespace can confirm this story. Got it from a PAL pilot who is just awaiting his retirement.

When LTG bought out SMC, kapitan asked a favor from JJB to return back to his seat as President and COO. JJB had a condition for LT. And for as long as he can transform PAL into a 5-star airline, he is willing to return. So LT in effect gave JJB the freedom to transform PAL, with JJB freely calling the shots. JJB knew, being an accountant, that the move will be long term, and that the airline may be experiencing losses at first, but would be able to recoup them later on due to improved customer experience. Thus, the "get that star" movement. While we all know that Skytrax is also about how much money you can dole out, it was still marketing for PAL, and the benchmark of going 5-stars really changed service levels and customer.experience.

JJB knew that 5-stars were somewhat impossible as PAL didnt have first class seats and a lounge like other airlines, plus crappy airport experience, but at least the direction pushed PAL to improve services.

2017-2019 everything paid off and PAL was being recognized worldwide for the huge improvements, also becoming a threat to other APAC and SEA airlines. However, that Mabuhay Maritime issue and the entrance of the Tan children and Carmen cut everything. When LT became senile, Carmen, Vivienne, and Shiela were calling all the shots and they know nothing about running an airline. They made JJB forced retire, and JJB cutting ties with the Tan family. From then on, PAL's spiraling down.

The main goal of the present Tans in control, the Tan women, is simply to make money. They really dont care about customer experience. Those classic PAL battlecry of "PAL is the Philippines" is pure BS. Its all drama. All the Tans want is control and milk money. Their greed is causing PAL to bleed and they dont care.

According to him, C11 was not really necessary as PAL was making money from cargo and chartered flights including repatriation flights during the pandemic. C11 just gave the airline the chance not to pay lessors and creditors.

Again, all these came from someone I know in PAL. I dont really know how true all of these are but somewhere in the middle, I know that there is some truth to what he said. According to the pilot too, the present numbers should already tell us the story. LT3, Capt Stan, and the rest are merely figureheads of the Tan women who dont know how to run an airline.

[Arianespace]

During JJB's time he was in control of PAL. Same thing with Sta. Maria management. The former retired, and the latter was let go because the airline couldn't afford his services anymore.



Mabuhay Maritime Express (MME) was the brainchild of LT son-in-law Joseph Chua conceptualized in 2015. It was meant to address connectivity problems between Kalibo and Boracay and complement PAL flights to the island. Basically, the idea was for PAL to ferry passengers from Kalibo all the way to Boracay,  that is end-to-point service for seamless travel. What made the idea flawed was that it was exclusive to PAL passengers, and not open to other airline passengers. Seamless comfort has a price. That's what it is.

In 2018, Kalibo was at the height of its international operations as it received substantial international traffic to the leisure island of Boracay coming from China, Korea, and Japan. It had a good run from October 2018 until covid pandemic struck and reach our shores sometime in March of 2019. Naturally, it had to stop operation. PAL booked ₱774 million in impairment losses in 2019 from the business bust (₱540 million for MV Malambing and MV Magalang vessels and P235 million for Kalibo and Boracay jetty terminals).

When the pandemic was over, the international market was gone. But the investment made was not a bad decision. MME was just a victim of unfortunate business climate and circumstances beyond the foresight of every businessman.

The intricacies of Chapter 11 (Bankruptcy) is seldom understood in the Philippines, as only lawyers understand the same. Briefly, it is the protection of PAL, as a corporation to continue operate as an airline without having to worry about its creditors and its growing debts. PAL was itself victim of that unfortunate event in our nation's history. Tan had three options then, sale to government, rehab or die. Government said no. His got 2 options left. There is no "in between" in the corporate world. Rehab requires additional investments ($500m). The latter does not require more money. He chooses the latter, even if his family was ready to let it go. That sums it up.

[Evodesire]

Arianespace wrote

He chooses the latter, even if his family was ready to let it go. That sums it up.

So is this the reason why the Tan women are controlling things to the point that they are causing PAL to die a natural death?

[Solblanc]

They can always sell it to San Miguel or some other conglomerate. The Tans aren’t the richest anymore and I’m sure some other family would be interested in a fire sale if they don’t want it

[Arianespace]

Quoting  Vivienne, his dad has more love of PAL than all of them does. Even JJB acknowledges this fact during his time. Even advising the mogul to let it go. But he did not. Goes to show the heart of the man.

If LT let go of PAL it would have been taken back by government, same way SIA, MAS, and THA went. Even CPA went back to government's hands now. So they have massive aircraft orders after takeover. They are also not private airlines anymore. So the order was taxpayer money.

PAL on the other hand remained in private hands. As LT put up the money, counterpart airlines in Asia-Pacific was paid by taxpayers money. That is already an achievement of PAL by itself as a survivor without returning to government hands. It was not however alone to receive government help without government intervention. CEB also was a beneficiary of government benevolence and made it through.

The difference however between the two is that CEB made commitments to grow the airline even bigger by taking investors in, while PAL is controlling the entry of other investors after LT businesses suffered a whipping from SMC. Lance has to give up his seat when Indigo Partners came in. LT family had a hard time swallowing RSA decision resulting to the split, and to the trauma of hostile corporate take-over. So PNB bought up debts to most of its creditors to stay in control.

[Evodesire]

Arianespace wrote

The difference however between the two is that CEB made commitments to grow the airline even bigger by taking investors in, while PAL is controlling the entry of other investors after LT businesses suffered a whipping from SMC. Lance has to give up his seat when Indigo Partners came in. LT family had a hard time swallowing RSA decision resulting to the split, and to the trauma of hostile corporate take-over. So PNB bought up debts to most of its creditors to stay in control.

Was this because RSA wanted to convert PAL into an LCC? I believe RSA was slowly putting SMC people in key management positions, and these people didn't know anything about running an airline.

[JNC03]

RP-C7784 to arrive in the next few days

[Evodesire]

I hope they will finally paint 7783 instead of just having decals. By the way, how long will PAL be leasing these ex GA planes?

[Arianespace]

JNC03 wrote

RP-C7784 to arrive in the next few days

It arrived yesterday evening. BOD was spooked by US DOT Law about flight diversions. Apparently, all orders were moved, including leased ones. October pa sana to. But we already knew that.

And while at it, I hope you marvel their new livery for this one, and possibly the new 35Ks? Ang ganda ng design...

[JNC03]

Looks like revised livery for me

When will 7777 be out?

[Arianespace]

RTL is December, so possibly after return of 79

[Evodesire]

Arianespace wrote

JNC03 wrote

RP-C7784 to arrive in the next few days

It arrived yesterday evening. BOD was spooked by US DOT Law about flight diversions. Apparently, all orders were moved, including leased ones. October pa sana to. But we already knew that.

And while at it, I hope you marvel their new livery for this one, and possibly the new 35Ks? Ang ganda ng design...

 
So will those A35K orders be moved to an earlier period? According to sources, the queen hen calling the shots knows nothing about running an airline. It was only Kapitan who had the heart and passion for it.

[Arianespace]

In the meantime, 7782 is AOG at YVR for unknown reason since Sunday

Philippine Airlines makes emergency landing at YVR but issue remains unclear
https://globalnews.ca/news/10875165/philippine-airlines-emergency-landing-yvr/