Partners in climbBy Conrado R. Banal III
Philippine Daily Inquirer
When flag carrier PAL recently made its inaugural non-stop direct flight to Toronto, the largest highly cosmopolitan city in Canada, the airline brought along officials from the Department of Tourism.
And so the PAL maiden voyage also became, partly, an instant tourism promotion event for DOT. Hmmm.
What do you think: Could it be the start of a lasting partnership between the flag carrier and the government, or at least the Aquino (Part II) administration, courtesy of the tourism department?
Like it or not, the tourism sector and PAL are undeniable commercial partners because each side is a direct beneficiary of the other’s endeavors to boost business.
As we all know, the present major stockholders of PAL are the most unlikely of partners because the Lucio Tan group, having 51 percent of PAL, and the San Miguel conglomerate, with 49 percent and management control, have always been stiff competitors in the beverage, beer and liquor industries as well as in the food business.
Just exactly what made them decide to go to bed together, well, may be the subject of speculation in business circles in the next couple of millennia.
Anyway, during the Toronto flight inaugural ceremonies at the Naia, San Miguel vice chair Ramon Ang, who also serves as PAL president and COO, told me that he expected PAL to post a little profit in 2012 and 2013. But the key to PAL’s profitable future beyond 2013, according to RSA, was still its programmed acquisition of new aircraft, particularly the fuel-efficient “777” series of the US-based Boeing, which PAL intends to use in its long-haul routes like Manila-Toronto.
From what I gathered, however, to get delivery of the “777” series, all airlines in the world have to line up all the way to limbo. And yet PAL is looking at buying around a hundred new airplanes in the next four years. In its expansion plan, PAL aims to acquire a fleet combining Boeing’s “777” series, for its long-haul routes to Europe and New York, with Airbus models for regional flights like new routes to Australia and the Middle East.
According to the PAL master plan, the Toronto route itself eventually will become daily flights, three times a week non-stop and four times via Vancouver, as soon as the airline is able to get deliveries from Boeing.
That is why PAL also wants to promote Philippine tourism in Canada. In the Toronto inaugural flight, for instance, the airline unwrapped its own designs of “more-fun-in-the-Philippines” posters, highlighting destinations like the ever-popular Boracay.
On the other hand, the DOT already launched a massive campaign to boost arrivals into the country, both foreign tourists and overseas Filipinos (or what the department terms as “VFRs,” meaning, “visiting friends and relations”), aiming for close to five million foreign arrivals this year.
I am quite certain that PAL executives are wearing wide smiles because of the DOT campaign. Surely, more VFR arrivals for instance mean better business for PAL.
It is true that, in the Toronto event, PAL vice president for marketing support Felix Cruz held a press conference, perhaps to help promote the airline’s new route. Still, the airline also presented in the press conference a couple of DOT officials, namely undersecretary for tourism planning and promotions Daniel Corpus and assistant secretary for international tourism promotion Benito Bengzon.
From what I gathered, both Corpus and Bengzon are career officials at the department. I must admit that I thoroughly enjoyed the press conference since the two DOT officials talked a lot of sense.
Actually, they fielded even embarrassing questions during the briefing that was attended by Toronto-based travel media and even newspapers serving the Filipino community in the so-called GTA, or the Greater Toronto Area, such as the Philippine Reporter, said to be the biggest Filipino newspaper in Canada, now in existence for some 24 years.
Anyway, the figures seem to support the PAL expansion plan for the Canadian market, particularly because of the sheer number of Canadian citizens with Filipino roots. They are now estimated at anywhere between 600,000 (the figure used by the Canadian ambassador Christopher Thornley during the inaugural ceremonies) and 800,000 (the figure cited by Canadian Prime Minister Stephen Harper during his visit to Manila last month).
Whatever the exact number of Filipinos in that country, the figures can only mean a ready market for PAL. And because of its new service to Toronto, as if on cue, the DOT already raised its projections on yearly arrivals from Canada.
Last year, according to the DOT figures, the Philippines recorded only some 96,000 arrivals from Canada—out of close to four million arrivals. Due to the natural increase of the Philippine tourism market in Canada, the DOT this year projects arrivals from that country to hit at least 120,000 in both tourists and VFRs.
In the first 10 months of 2012 alone, the DOT already posted 86,000 from Canada. And we all know that droves of Filipinos there are bound to come home for Christmas.
But here is the jackpot: With the new service of PAL, the direct flight between Toronto and Manila, the DOT expects the figure to zoom up to more than 150,000 arrivals in 2013—an increase of about 20 percent.
And that is just one additional direct non-stop route for PAL.