PAL focusing on secondary hubs

Philippine Airlines (PAL) plans to strengthen secondary hubs outside Manila’s Ninoy Aquino International Airport, where capacity is strained due to the lack of expansion solutions outside a private sector proposal that remains pending with the government.

The flag carrier, in the midst of upgrading its fleet with newer fuel-efficient planes, said it would continue to expand its route network in 2019.

“Plans include the introduction of new destinations and city pairs. More flights will be added in secondary hubs such as Clark, Cebu, Davao, and Kalibo,” operator PAL Holdings Inc. said in its 2018 annual report.

“Flight schedules and timings will also be improved to provide more convenience and better connections,” the carrier added.

PAL’s owner, billionaire Lucio Tan, is part of a consortium of tycoons seeking to modernize and expand Naia. The P102-billion offer—first made in February 2018—was aimed at easing both air and passenger congestion over four years while improving connectivity among Naia’s main terminals.

For its part, PAL is allocating some $650 million this year as it takes delivery of six new planes. These are two Airbus A350-900s, two Airbus A321neos and two A321ceos. It ended 2018 with 97 aircraft, some of which would be phased out as PAL added new planes.

The refleeting is a key part of PAL’s strategy to become a five-star airline by 2020.

“New modern and technologically advanced aircraft on order will be delivered in the coming years. These new aircraft types will not only result in operational efficiency, reliability and profitability, but will provide comfort and improve the product and service offerings,” PAL noted.

“PAL will explore on sales and business opportunities, invest on facility and resource improvement programs, acquire more efficient operating system, optimize flight and ground operations, and constantly prioritize safety,” it added.

In February, PAL sealed a strategic agreement with ANA Group which involved the Japanese giant taking a roughly 9.5-percent stake in the company. The partnership was seen to bolster PAL’s global reach and consequently, its profitability.

PAL Holdings narrowed losses to P4.33 billion in 2018 from P7.33 billion the previous year. Passenger sales drove up total revenues, which increased 16.2 percent to P150.4 billion last year.

PAL carried 15.9 million passengers last year versus 14.5 million passengers the previous year.