MANILA, Philippines?Flag carrier Philippine Airlines (PAL) is considering more cost-cutting measures for 2011 to help the company cope with steadily rising oil prices and increased competition in the air travel industry.
Part of these plans will be the deployment of one of its two flagship Boeing 777 aircraft for direct flights to Vancouver, Canada, starting March next year as the airline aims to maximize the profits made from the long-haul route.
The Boeing 777 jets were originally ordered for the expansion of the company?s services to the United States. However, substandard aviation safety standards implemented by the government led to a downgrade to a category 2 status for the Philippines by the US Federal Aviation Administration. This means that all airlines from the Philippines will not be allowed to expand operations to the United States.
PAL president Jaime J. Bautista said the company?s Airbus A340 jets, which are currently being used for the Canada service, would be moved to Melbourne, Australia, to make way for the Boeing aircraft.
?The airline industry is very cyclical. That?s why we have to improve our operations,? Bautista said. He noted that the newer Boeing jets were 20-percent cheaper to run than the Airbus units and allow the company to earn more from the already high-margin flights.
Bautista said the Airbus aircraft might be used to other PAL destinations that require planes that can carry 260 people or less.
PAL?s two 777s were delivered in the last two years. The company has two more on the way, with one arriving in 2012 and the next in 2013.
Other moves to help cut costs included the selling of more discounted tickets, especially during lean months, to encourage more people to travel.
Bautista said the company expected to end the third quarter of its fiscal year in the black, making the October-December period its third consecutive profitable reporting period.
?Our passenger volumes in the third quarter of the fiscal year are up 10 percent over last year. Hopefully, we will be in the black,? Bautista said.