Airlines In The Philippines III

[romantic_guy08]

Arianespace wrote

Solblanc wrote

Surely even a lease of 5 A339s if only to properly serve Australia is better than cancelling Dammam and wet-leasing Wamos?

First point, PAL wants to have a plane that can fly both to EU and West coast with a decent payload. For obvious reason.The neo, while a capable plane couldn't do that.

If repeated SFO cancellation is an early indication, PAL doesn't need a high capacity plane given a direct competition. Never thought of that before. But they have, thus the insistence of a smaller Boeing which can carry 300 people less than the 360 pax 35K would. More like what the 330 is doing to LAX now. If it happens in SFO it could happen to LAX with DAL around the corner.

Second point, CX ordered the neo because they are NOT retrofitting the old A330. Which means they are retiring it. PR on the other hand is retrofitting for the third time their A330. Which means they intend to use it beyond 12 years. If indications of a new order is forthcoming, retrofitting would not be an option. Still, PAL 330 is younger than CPA at 10 years old. They can still fly 6 years more, if we follow PAL retirement policy.

Of course PAL understood they could never order the Boeing in the next 6 years, the reason why Boeing offered them the lease options from lessors, with rate sweeteners dampen from the package max.

Third point, CX retrofitted their 77w to operate 6 years more because of delay in the delivery of the ordered 779s. While there is no substantial delay in the delivery of PR 35k, there is however a long waiting time for the delivery of a smaller plane designed to fill leaner routes in America and Europe as explained in point number 1. The A359 would have been okay if they are less expensive than the Boeing.

As this report suggest, they are actually true.


https://www.iba.aero/resources/articles/aircraft-values-lease-rates-september-2024/

With that in mind, aside from the 35k they have, no other widebody planes is forthcoming for them to service the routes that they suspended and fly for leaner routes they envisioned. If they find lessors for A330s they could have find it by now, and not went to wet leasing. The Wamos contract extension indicates dire supply problem for widebody aircraft as shown in the report of my previous post.

If BOD continue to put its food down, their only alternative is retrofitting the newer 77w other than 3 frames that is set for retirement, as the 35k arrives. In fact, JED was cut because it was always flown with block seats on their high density 330s. They couldn't fly the xx8x in KSA because of product inconsistency. The 77w would do that with ease, as well as flight services to Oz and kiwi island.

And with lease rates mentioned in that report above, its already a bargain for the thrift airline.

While NEO is  a good plane, there is limit of what it can and cannot do. The 77w addresses them with a discount.

Any chance PR can still get late built 77Ws in the market? or if Boeing decides to restart the production line?

[Solblanc]

Arianespace wrote

Solblanc wrote

Surely even a lease of 5 A339s if only to properly serve Australia is better than cancelling Dammam and wet-leasing Wamos?

First point, PAL wants to have a plane that can fly both to EU and West coast with a decent payload. For obvious reason.The neo, while a capable plane couldn't do that.

If repeated SFO cancellation is an early indication, PAL doesn't need a high capacity plane given a direct competition. Never thought of that before. But they have, thus the insistence of a smaller Boeing which can carry 300 people less than the 360 pax 35K would. More like what the 330 is doing to LAX now. If it happens in SFO it could happen to LAX with DAL around the corner.

Second point, CX ordered the neo because they are NOT retrofitting the old A330. Which means they are retiring it. PR on the other hand is retrofitting for the third time their A330. Which means they intend to use it beyond 12 years. If indications of a new order is forthcoming, retrofitting would not be an option. Still, PAL 330 is younger than CPA at 10 years old. They can still fly 6 years more, if we follow PAL retirement policy.

Of course PAL understood they could never order the Boeing in the next 6 years, the reason why Boeing offered them the lease options from lessors, with rate sweeteners dampen from the package max.

Third point, CX retrofitted their 77w to operate 6 years more because of delay in the delivery of the ordered 779s. While there is no substantial delay in the delivery of PR 35k, there is however a long waiting time for the delivery of a smaller plane designed to fill leaner routes in America and Europe as explained in point number 1. The A359 would have been okay if they are less expensive than the Boeing.

As this report suggest, they are actually true.


https://www.iba.aero/resources/articles/aircraft-values-lease-rates-september-2024/

With that in mind, aside from the 35k they have, no other widebody planes is forthcoming for them to service the routes that they suspended and fly for leaner routes they envisioned. If they find lessors for A330s they could have find it by now, and not went to wet leasing. The Wamos contract extension indicates dire supply problem for widebody aircraft as shown in the report of my previous post.

If BOD continue to put its food down, their only alternative is retrofitting the newer 77w other than 3 frames that is set for retirement, as the 35k arrives. In fact, JED was cut because it was always flown with block seats on their high density 330s. They couldn't fly the xx8x in KSA because of product inconsistency. The 77w would do that with ease, as well as flight services to Oz and kiwi island.

And with lease rates mentioned in that report above, its already a bargain for the thrift airline.

While NEO is  a good plane, there is limit of what it can and cannot do. The 77w addresses them with a discount.

The 77W can address the Mideast market if configured properly. The A35K is perfectly fine to handle all the transpac traffic, especially if they don’t fill it up to the gills and just use 9-abreast.

The Neo has the range and payload capabilities of an A343. We remember that lax/sfo needed a gum stop, but YVR did not, and by extension, SEA. It may not be able to hit all points in the west coast, but it can hit some.

But the key advantage of the Neo is that it can be abused short-haul, as Airbus made so many improvements to its short-haul performance. While the A321s are being retrofitted, any short-haul growth will go to Cebu Pacific. Japan is a market with high J demand. Bangkok and Singapore are becoming good feeders for transpac.

Finally, and I cannot stress this enough, 9 abreast A333s just have to go. A full service carrier should not be flying a charter configuration. The neos should be able to bring operating costs down for an 8-abreast config to work.

Of course, the 787s are a much better choice. And if it seems expensive, have they looked at airfares recently? They’re all going up! And people are starting to complain that they’re not getting the bang for their buck on PAL.

[Arianespace]

Perhaps not. As the report suggests, they are in short supply as airlines are extending leases of these birds to beyond 12 years, and PAL might have to extend theirs as well. Boeing is all 77x now.

Solblanc wrote

Finally, and I cannot stress this enough, 9 abreast A333s just have to go. A full service carrier should not be flying a charter configuration. The neos should be able to bring operating costs down for an 8-abreast config to work.

Of course, the 787s are a much better choice. And if it seems expensive, have they looked at airfares recently? They’re all going up! And people are starting to complain that they’re not getting the bang for their buck on PAL.

PAL intends to configure 787 with 9, so most likely, the neo would have to do the same. If it is configured in 9 it would look like Corsair with 350 seats. By Airbus calculations, it would have a payload of around 35t. Now look at the range chart below:




35t is enough to bring 350 people to Manila. That is passenger only, with no bags or luggage. if you add payloads to it, meaning bags and luggage, to around 51 tons, its maximum MTOW, it cannot even reach GUAM. To arrive in MNL you actually need to reduce payload to around 35t, which translates to around 250 passengers only together with their luggage.  Which defeat its purpose on why they bring them to their fleet. Unlike the 789 which would bring them 300 pax for the same range with 5tons more payload.

You see, PAL need extra payload capabilities for its cargo operations to North America, to which it derives ancillary revenues. As stated by Stan, they need that cargo space. The airline's business model has been molded to capitalize on Filipinos propensity to bring back anything stateside home in the now famous balikbayan boxes. A 40kg. free baggage allowance for North America is a deal breaker for other airlines. Not PAL because they incorporated it to their business model. Yes, you pay a higher fare, but your boxes gets to your home, particularly if you or your folks resides in the provinces, and that is what matters. For us Filipinos anyway.  And that matters to PAL too. Payload consideration is what is most important to them, and the most crucial thing. And that is the reason why 77w and even the old 744 stops at GUM. Because they traded range with payloads, so that no balikbayan box is left behind.

[JNC03]

So they are pursuing the deal for new narrows? including Embraer which can be delivered faster

[airline_builder]

it actually boils down to "FUNDS"

there are lot of suppliers for planes for lease available immediately, and they can tailor fit the desired configuration according to their client's specifications should the latter be particular.

from 77W, 333s, 332, 78-8-9s, 359s and given the global need to bridge their respective fleets then obviously the costs are high but if the business model and routes currently flown are revenue makers then it will be reasonable to project the integration of these cost seamlessly since passengers now are mentally prepared to travel with full knowledge that ticket prices have gone up.

again, boils down to who is in-charge and discharge the vital decisions that PAL needs with sensitivity to time and opportunities at hand.

[Solblanc]

Arianespace wrote

Perhaps not. As the report suggests, they are in short supply as airlines are extending leases of these birds to beyond 12 years, and PAL might have to extend theirs as well. Boeing is all 77x now.

Solblanc wrote

Finally, and I cannot stress this enough, 9 abreast A333s just have to go. A full service carrier should not be flying a charter configuration. The neos should be able to bring operating costs down for an 8-abreast config to work.

Of course, the 787s are a much better choice. And if it seems expensive, have they looked at airfares recently? They’re all going up! And people are starting to complain that they’re not getting the bang for their buck on PAL.

PAL intends to configure 787 with 9, so most likely, the neo would have to do the same. If it is configured in 9 it would look like Corsair with 350 seats. By Airbus calculations, it would have a payload of around 35t. Now look at the range chart below:




35t is enough to bring 350 people to Manila. That is passenger only, with no bags or luggage. if you add payloads to it, meaning bags and luggage, to around 51 tons, its maximum MTOW, it cannot even reach GUAM. To arrive in MNL you actually need to reduce payload to around 35t, which translates to around 250 passengers only together with their luggage.  Which defeat its purpose on why they bring them to their fleet. Unlike the 789 which would bring them 300 pax for the same range with 5tons more payload.

You see, PAL need extra payload capabilities for its cargo operations to North America, to which it derives ancillary revenues. As stated by Stan, they need that cargo space. The airline's business model has been molded to capitalize on Filipinos propensity to bring back anything stateside home in the now famous balikbayan boxes. A 40kg. free baggage allowance for North America is a deal breaker for other airlines. Not PAL because they incorporated it to their business model. Yes, you pay a higher fare, but your boxes gets to your home, particularly if you or your folks resides in the provinces, and that is what matters. For us Filipinos anyway.  And that matters to PAL too. Payload consideration is what is most important to them, and the most crucial thing. And that is the reason why 77w and even the old 744 stops at GUM. Because they traded range with payloads, so that no balikbayan box is left behind.

If PAL wanted to transport 350+ passengers transpac, they already have an existing plane - the 77W, and an upcoming plane - the 35K. If they’re just going to fill up an A330 like Corsair, that defeats the point of getting a smaller plane. The 787-10 cannot do transpac. But the 787-9 can.

The 787 in 9 abreast has been adopted by most full-service carriers, even SQ. No full service carrier but PAL has the A330 in 9 abreast, and no full service carrier but PAL has indicated that they want to put 10 abreast on the A350.

If they use a normal density 8-abreast NEO, it can do SEA if need be. They have other planes for other routes. And if they think that a 10-abreast 35K will be too much capacity, e di put 9 abreast like CX.

The only reason why Wamos planes are flying to Australia is that the AU market rejects 9-abreast on a full service carrier. And the only reason why PAL can’t send their own “premium” A330s is because they densified some of the others for the Mideast, and then surprise surprise, Dammam gets cancelled because of AOG anyway. The existing medium-haul fleet is clearly insufficient. From pre-pandemic 15 A330s to 12. Practically all passenger growth is going to Cebu Pacific, which is now the largest airline into Australia by capacity since they matched PAL’s SYD/MEL frequencies with their mammoth A330neos.

So I wonder how the bean counters are working. Higher fares means more revenue, but cancelled flights are less revenue, and wet-leasing aircraft is high in costs. Will AOGs magically get better next year? Are they even going to make a profit next year? I guess only time will tell.

[Darkknight85]

RP-C773 is going to CDG is this a maintenance flight or chartered flight?

[Evodesire]

Is there a way to check the current capacity of the Philippines - Australia routes? Cebu Pacific's SYD & MEL capacity combined is bigger than PAL's SYD, MEL, PER, and BNE combined?

[romantic_guy08]

Darkknight85 wrote

RP-C773 is going to CDG is this a maintenance flight or chartered flight?

77 also just returned from Shenzen as 6777 just as 73 departed for CDG...

Btw, also noticed that PR102 to LAX is no longer daily...

[Solblanc]

Evodesire wrote

Is there a way to check the current capacity of the Philippines - Australia routes? Cebu Pacific's SYD & MEL capacity combined is bigger than PAL's SYD, MEL, PER, and BNE combined?

It will be starting December. MNL-SYD will become daily and MNL-MEL 5x weekly, matching PAL’s frequencies. 12x459 = 5508 one-way seats for 5J.

Wamos A330-200s vary in configuration, but I believe the product flying has 266 seats; 266x12 = 3192 and add the Neo flights to BNE and PER, that’s 168x10 = 1680 for a grand total of 4872 seats for PAL.

Bear in mind, the ASA has a limit of 10700 seats per week to SYD/MEL/BNE/PER. If 5J expands even more, PAL will be shut out from expanding. If they’re not careful, they might not even be able to upgauge to their own A330s.

[JNC03]

The Gokongweis are making a big bet on the growth potential of domestic travel as their budget carrier Cebu Pacific has bought out boutique airline AirSWIFT Transport Inc. for P1.75 billion.

After placing a massive $24 billion order for 152 aircraft, Cebu Pacific is taking another step to spread its wings in the domestic market, this time acquiring full ownership of AirSWIFT from Ayala Land Inc. (ALI) Capital Corp.

For Cebu Pacific, the acquisition means boosting its fleet with five turboprops from AirSWIFT, three of which are ATR 72s and two are ATR 42s. As a result, Cebu Pacific grows its turboprop fleet to 20, building up its capability to reach island destinations. The buyout also brings Cebu Pacific to a new route in El Nido, Palawan.

Although Cebu Pacific is taking over AirSWIFT, ALI Capital will remain owner and operator of the Lio Airport in El Nido. Cebu Pacific has no plans to make drastic changes in the flight schedules and services of AirSWIFT for the convenience of passengers.
Given this, travelers booked with AirSWIFT can expect to take their flights without disruption.

AirSWIFT would run as a wholly owned subsidiary of Cebu Pacific for now, as its integration will be gradually done over time to ensure continued service. However, Cebu Pacific would have to eventually reassess the network, as some of AirSWIFT’s routes are already served by regional unit Cebgo Inc.



https://www.philstar.com/business/2024/10/07/2390584/cebu-pacific-buys-out-ayala-airline-p175-billion

[JNC03]

Some PAL employees received 787 merch from Boeing

[Arianespace]

Solblanc wrote

Linking back to what you previously said, you mentioned that the Boeing offer was good until October. October is next week. Will that Boeing offer still be on the table in 2025?

A visit to Boeing office by PR executives was confirmed to me this morning. Its the office not the plant. No further details was provided. Guess what you will.

[Solblanc]

Arianespace wrote

Solblanc wrote

Linking back to what you previously said, you mentioned that the Boeing offer was good until October. October is next week. Will that Boeing offer still be on the table in 2025?

A visit to Boeing office by PR executives was confirmed to me this morning. Its the office not the plant. No further details was provided. Guess what you will.

All we can do here is guess and just wait for what is announced :)

[Evodesire]

They were carrying 787 items.

[Arianespace]

Darkknight85 wrote

RP-C773 is going to CDG is this a maintenance flight or chartered flight?

Engine maintenance. Air France Industries KLM Engineering & Maintenance (AFI KLM E&M) is PAL’s maintenance, repair and overhaul (MRO) provider for GE90 engines that powers its Boeing 777 aircraft.

https://www.afiklmem.com/en/press-release/21062023-engine-support-an-enduring-partnership-between-philippine-airlines-and-afi-klm-em

[Arianespace]

Also returning to service are 8610 and 9914.

[Arianespace]

Capacity applies only to SYD, MEL and BNE. PER, CNS, and DRW has no flight restrictions. On the same matter, A330-300 capacity is registered not WAMOS 332.

[Arianespace]

JNC03 wrote

The Gokongweis are making a big bet on the growth potential of domestic travel as their budget carrier Cebu Pacific has bought out boutique airline AirSWIFT Transport Inc. for P1.75 billion.

https://www.philstar.com/business/2024/10/07/2390584/cebu-pacific-buys-out-ayala-airline-p175-billion

What is not quoted on the news is CEB earning 36 slot pairs from ATX. CEB has been leasing some slots from ATX prior to the sale, shared between SRQ. So you see the ATR fly more than the slots SGD have.

[JNC03]

Flag carrier Philippine Airlines (PAL) has listed Chicago and Houston as two other possible destinations it may soon reach in the US.

In an interview with reporters here, PAL vice president for sales Bud Britanico said the airline is determined to recover its market share for Philippine flights to North America

PAL is looking at a list of US destinations it could add to its flight network once it receives its order for nine widebodies in the make of Airbus A350-1000s

Britanico said these potential routes include Illinois and Texas, both of which shelter hundreds of thousands of Filipinos. Latest available census showed that a combined 360,000 Filipinos live in these states, of which 200,000 are in Texas and 160,000 are in Illinois.

Moreover, PAL has kept its doors open for Nevada, which is home to roughly 170,000 Filipinos mostly working for casinos in Las Vegas.

Although Britanico made it clear that further studies and new aircraft are needed to mount expansion flights.

PAL is trying to recover its market dominance for transpacific flights from the Philippines, as it faces new rivals such as United Airlines, which has been mounting direct trips to the US since 2023.

PAL’s market share for Philippine flights to the US and Canada fell to 47 percent last year, from 65 percent in 2022, but the airline is working on recovering its former shape.


https://www.philstar.com/business/2024/10/09/2391089/pal-broadening-us-routes-sets-sights-chicago-houston