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PAL in code-share talks with Japanese airline

/ 04:17 AM January 24, 2014

Flag carrier Philippine Airlines (PAL) is negotiating with Japan’s All Nippon Airways Co. Ltd. for a code-share arrangement, as talks for the latter to invest in PAL had been shelved for now, its top official said.

Talks for a code-share agreement could be wrapped up within 30 days, Philippine Airlines president Ramon Ang told reporters. Such an arrangement, he said, would help PAL extend its network while managing costs.

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A code-share deal, which is widely utilized in the aviation industry, is a commercial arrangement that allows passengers to book tickets with one airline but the flight is served by a cooperating carrier.

“We are looking at what we can do to be able to improve our service,” Ang said at the sidelines of the launch of a tollroad extension project of San Miguel Corp. and Indonesia’s Citra Group. Ang is also president of San Miguel, a minority shareholder of PAL.

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Ang said Ana had wanted to invest in PAL. “But I decided to shelve this and focus on the code-share first.”

PAL is controlled by the group of Tycoon Lucio Tan, which remains keen on selling its 51-percent stake in the airline. Tan was reportedly in talks with foreign carriers to sell his stake, although a deal has yet to be finalized.

PAL, which is in the midst of a $9.5-billion refleeting strategy involving 64 mid-range and long-range Airbus planes, has been working on strengthening its regional presence as its competitors continue to consolidate.

Earlier this month, budget carrier Cebu Pacific Air sealed a strategic alliance with Singapore’s Tiger Airways that they claimed would create the biggest network of flights to the region. The deal includes Cebu Pacific’s acquisition of 100 percent of Tigerair Philippines for $15 million.

The deal would also allow both groups to leverage on their networks spanning from North Asia, Asean, Australia, India and the Middle East.—Miguel R. Camus

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TAGS: agreements, Air Transport, All Nippon Airways, Business, code-share, Japan, PAL, Philippine Airlines, Philippines
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