Friday, May 22, 2015

Philippine Airlines Denies Plans to Axe London Route; KLM Mulling Resumption of Nonstop Flights

Flights between Europe and the Philippines may be turning a corner as senior officials from two major airline groups have at ruled out reduction of service at least for the time being.

Image by Wikimedia
Philippine Airlines (PAL) President Jaime Bautista for one put an end to rumours that the flag carrier was axing sole flight between Manila and Europe, PR720/721.  Currently, PR720/721 flies between Manila and London four times a week using an Airbus A340-300 (A343).  Bautista cited improving business conditions, particularly more favourable fuel prices and a better flight schedule, for the continuation of its sole service connecting Manila and Europe.  

Previously the flight operated five times a week using a Boeing 777-300ER.  The service was downgraded to an A343 as the 777 aircraft was reallocated to the flag carrier's flagship routes in the United States.  The A343 does not feature its own individual in-flight entertainment (IFE) system for economy class and passengers seated in that section will have to request an iPad for the 14-15 hour journey.  

Meanwhile, European carrier Air France-KLM is considering the resumption of non-stop flights between Manila and Amsterdam.  Patrick Roux, Vice President for the Asia-Pacific of KLM said that this is possible if market conditions continue to become more favourable in the Philippines.  Roux says the group is also eyeing the possibility of selling tickets between Manila and Taipei, which is currently not possible under existing air service agreements, as well as the resumption of flights by KLM's sister carrier, Air France.  Air France last flew to the Philippines in 2004 but discontinued flights of its own to the country after it merged to form the Air France-KLM group.    

KLM Boeing 777-200ER
Image by Wikimedia

KLM's service was non-stop starting 2004 but it was relegated to a one-stop service via Taipei in 2012.  This move was supposedly prompted by the Philippine government's reluctance back then to scrap the Common Carrier Tax (CCT).  The CCT has beem levied by the government on foreign carriers based on the airfare charged and distance flown between the Philippines and its next destination.  This charge was subsequently dropped.  However analysts have suggested that intense competition from Gulf Carriers may have also played a hand in KLM's decision to cease non-stop service.

However, if Air France will resume its service or KLM will enhance its existing services, they would not be the only European carriers operating in the Philippines.  Last March 15, Turkish Airlines started non-stop flights between its Istanbul base and Manila.  The Turkish carrier has received top accolades from the likes of Skytrax.  Although Turkish Airlines' Manila service is currently operated three times a week with an A343, airline timetables have indicated that next year Manila flights may see a Boeing 777-300ER.  Being at the south eastern tip of the European continent, Istanbul has become an increasingly popular connecting point between Europe and Asia as backtracking is minimised.

Thursday, May 21, 2015

Philippine Airlines Launching New Zealand Flights, Adds Cairns

Filipinos in New Zealand have finally had their wish granted just in time for the Christmas season when Philippine Airlines begins direct flights from Manila to Auckland, New Zealand in December. PAL will be connecting both cities via Cairns, Australia. 

philippine airlines auckland
Copyright Photo: Angelo Agcamaran/PPSG
Philippine Airlines will launch four weekly flights between the two countries beginning on December 1. It will be the first time that PAL has served New Zealand. Flights will be operated by an Airbus A320 aircraft, making a stopover in Cairns, Australia travelling in both directions.

The stopover in Cairns will expand Philippine Airlines' network of Australian cities to five after Sydney, Melbourne, Darwin, and Brisbane. Australian tourists and Filipinos residing in Cairns will now be able to enjoy a direct link to the Philippines. In addition, Philippine Airlines will have the rights to pick up passengers in Cairns, who are bound for Auckland.

Air New Zealand is presently the only carrier operating direct service between Auckland and Cairns. When Philippine Airlines begins operating the route in December, it will be competing directly with Air New Zealand for traffic between the two cities. The announcement has drawn positive feedback from officials in all three countries. 

A Positive Boost for Tourism in New Zealand

In New Zealand, airport officials said that the new flight was good news for tourism and the economy. "This new service will see 64,500 seats per year on the Manila to Auckland route, contributing an estimated $41 million per year to the New Zealand economy," said Norris Carter, General Manager of Auckland Airport. "This new service will provide more options for visitors when travelling to New Zealand and also for New Zealanders wishing to visit the Philippines."

There are currently an estimated 40,000 Filipinos living in New Zealand. Travel is growing between the two countries as more New Zealanders discover the Philippines as a tourist destination and as more Filipinos travel to New Zealand to visit friends and relatives.

An Economic Injection for Queensland, Australia

In Cairns, residents are thrilled with the opportunity to fly directly to the Philippines for a holiday, while also gaining more choice and competition when travelling to New Zealand. The flights will stimulate economic activity in the region, where tourists from both the Philippines and New Zealand will be able to fly in to experience the Great Barrier Reef

According to airport officials in Cairns, tens of millions of dollars are expected to be injected into the region's economy annually as a result of the new flights. "It's a significant boost to our economy. This gives us year-round connectivity to Auckland and that whole new opportunity into South-East Asia and beyond," said Kevin Brown, CEO of Cairns Airport. "This service is four times a week. In time, it may get to daily. If it does, there's potential of $80 million of economic growth for our region."

Australian tourism officials said that the flights would bring more New Zealanders to Cairns. "The New Zealand market is the low hanging fruit and our cousins in New Zealand are very interested in coming to Cairns," said Alex de Waal, Chief Executive of Tourism North Queensland. "They love the destination. It's a short hop, step, and a jump to get here. New Zealand is a very significant market for this region. I think the volume of passengers will be very significant."

The Philippine Airlines Airbus A320 aircraft operating the route will be equipped with 156 seats featuring Business and Economy class. The approximate stopover time in Cairns will be just one hour. Air New Zealand also uses an Airbus A320 on its service between Auckland and Cairns. 

Flights will depart Manila on Mondays, Wednesdays, Thursdays, and Sundays at 11:45pm. The flight touches down in Cairns the following morning at 8:00am, eventually reaching Auckland at 4:00pm after a one hour layover in Cairns. Return trips depart Auckland at 6:30pm on Mondays, Tuesdays, Thursdays, and Fridays. They arrive in Cairns at 10:30pm and depart for Manila one hour later, arriving in the Philippine capital at 3:30am the following morning. 

According to Philippine Airlines President Jaime Bautista, the new flights will stimulate passenger traffic between three city pairs: Manila and Cairns, Cairns and Auckland, and Manila and Auckland. "With close to 40,000 Filipinos residing in New Zealand, the new service is their convenient link to their home country," said Bautista.

The announcement comes following the enhancement of the Philippines-Australia air services agreement last year. The new flights are still subject to regulatory approval. In 2014, twelve-thousand Filipinos visited New Zealand, while 20,000 New Zealanders visited the Philippines. 

Bautista added that the new route will also stimulate traffic between Southeast Asia and New Zealand. However, Philippine Airlines won't be alone for long in Cairns as Singapore based SilkAir prepares to launch its own Cairns to Singapore flights next week. 

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Tuesday, May 19, 2015

SkyJet and SEAir International Forced to Suspend Operations

The Civil Aviation Authority of the Philippines has suspended the operations of Philippine boutique leisure carriers SkyJet Airlines and South East Asian Airlines due to safety concerns. The suspension of both carriers' Air Operator Certificates took immediate effect on May 18.

magnum air
Copyright Photo: Adrian Smith/PPSG
An Air Operator Certificate enables an aircraft operator to conduct operations on a charter basis or for regular public transportation purposes among others. According to the national aviation regulator, various safety concerns were observed at both airlines, which resulted in the order to suspend operations immediately. 

At SEAIR International Incorporated, which operates as South East Asian Airlines, the Civil Aviation Authority highlighted issues with the carrier's flight safety program, rules on accident prevention, and its management structure. At Magnum Air, which operates as SkyJet, concerns were raised regarding flight data monitoring, maintenance control, and quality assurance pertaining to airworthiness. 

In citing its observations, the Civil Aviation Authority referenced a report that was published by the European Union Assessment Team, which visited the Philippines last month to observe the safety guidelines and procedures in place at a number of local carriers. The European Assessment Team was in the Philippines conducting an audit from April 16 to 24.

seair international
Copyright Photo: Angelo Agcamaran/PPSG
The Civil Aviation Authority issued letters on May 15 to Teodoro Fojas of SkyJet and Avelino Zapanta of South East Asian Airlines, signed by Director General William Hotchkiss, requesting that the safety concerns be corrected immediately. The suspension will remain in place until both carriers have complied with the safety regulations imposed by the national regulator under the Philippine Civil Aviation Regulations.

South East Asian Airlines currently operates flights from Manila to Basco, Caticlan, and Romblon. SkyJet operates flights from Manila to Basco and Coron. Prior to the suspension, SkyJet was planning to launch four weekly flights between Manila and Caticlan beginning on May 21. The flights would have been the fastest flights to Boracay from the Philippine capital operated by an 80-seat British Aerospace Bae 146-100 aircraft. 

In March, SkyJet was sold to the Solar Group media conglomerate after the Civil Aeronautics Board approved the transfer of ownership to Thunder Air Aviation. Ronald Tieng is the Chairman of SkyJet Airlines, while Dino Chua is President, and Ted Fojas is Chief Operating Officer. 

Monday, May 18, 2015

Philippine Airlines' Return to New York Drives Down Airfares

Just over two months after Philippine Airlines returned to New York after an eighteen year absence, Filipinos residing on the East Coast of the United States continue to rejoice over the lower airfares that the national flag carrier brought to the market.

Copyright Photo: Ben Granucci/Airline Reporter
After Philippine Airlines launched its New York flights on March 15, 2015, competing foreign carriers began lowering their prices on flights to the Philippines. With flights typically costing in excess of one thousand dollars in the past, Filipinos can now obtain a round-trip ticket for as little as $800

Several foreign carriers serve Manila from New York City with one-stop service including Cathay Pacific, Delta Airlines, EVA Air, Japan Airlines, Korean Airlines, and Asiana. All of these carriers dropped their airfares between February and May as Philippine Airlines geared up to re-launch their direct flights. 

According to local travel agents in New York that specialize in the Philippine market, fares dropped at one point lower than the price of airfares for Filipinos travelling from the west coast. While the airlines compete in an intense price war, the real winner ends up being the Filipino traveller, who now enjoys extra spending money while on holiday in the Philippines due to the lower fares.

However, industry experts do not believe that these significant drops in airfare will remain in the long-term and it is unlikely they will be available during peak periods. Despite that, the 500,000 Filipinos that are currently living in the Eastern United States are likely not going to have to pay airfares as high as they have in the past. In addition, those planning to travel during the busy Christmas travel season might just have a chance of finding a cheap flight promo if they book far in advance. 

Unlike the last time that Philippine Airlines served New York, overseas Filipinos are hoping that the national flag carrier will be here to stay for the long term as more competition means better fares for travellers. As Philippine Airlines is the only carrier offering a direct flight to Manila, fares are slightly higher with round-trip economy starting at $1,225.

For those that don't mind changing aircraft, there are a number of alternatives including Cathay Pacific and Delta Airlines. Cathay Pacific currently offers four daily flights between New York and Hong Kong, where onward connections are available to Manila. Delta Airlines offers service to Manila with a connection in Japan. 

Philippine Airlines last served New York in 1998, when the carrier ended service to Newark Liberty Airport due to the Asian Financial Crisis. Previously, the Philippines was placed under Category 2 status by the US Federal Aviation Administration's Safety Assessment Program, which prevented the carrier from launching flights to New York using its own aircraft and crews.

Eighteen years later, the Philippines is now a Category 1 nation, which has enabled Philippine Airlines to return to New York. PAL currently offers four flights weekly from New York to Manila with a two-hour transit stop in Vancouver. Negotiations are currently under way with Canadian and US authorities to enable Philippine Airlines to operate the route on a daily basis. 

The total flying time for those travelling the full-route between Manila and New York is 16.5 hours -- the carrier's longest flight. Flights are operated by a Philippine Airlines A340-300. Passengers travelling in Business Class can enjoy recliner-style seats in a 2-2-2 configuration. Each seat in Mabuhay Class features an individual seatback television screen. However, the content is limited and it is not available on-demand. 

In Economy Class, passengers enjoy a comfortable 2-4-2 configuration with a 33-inch seat pitch. However, in-flight entertainment is delivered through overhead monitors featuring main screen content. In addition, Philippine Airlines offers 12 audio channels. Those intending to use iPads or smart phones for entertainment should come prepared with a power bank as power ports are not available on this aircraft in either class of service. 

Philippine Airlines announced last year that it would be installing wireless internet and wireless in-flight entertainment across its entire fleet of Airbus A340 aircraft. However, the carrier has not specified a date for the aircraft to be retrofitted with the necessary equipment. 

Philippine Government Offers Incentives at Cebu International Airport

In a further effort to help decongest Ninoy Aquino International Airport in Manila, the Philippine government is planning to offer perks to provide greater incentive for airlines to operate more flights from Cebu. A public meeting is set for May 20, where an incentive plan will be presented regarding take-off and landing fees.

cebu airport
Copyright Photo: D.Wilson/PPSG
According to Nigel Villarete, General Manager of the Mactan-Cebu International Airport Authority, carriers can expect rebates between 30 and 75 percent on landing and take-off fees for long-haul international routes, and 30 to 65 percent discounts on short to medium-haul routes. However, the discounts will vary based on the number of flights offered per week.

Rebates will also be offered on domestic flights operated out of the country's second busiest airport. Villarete added that rebates can be expected between 25 to 65 percent on all landing and take-off fees for domestic routes based on the frequency of flights.

The news is welcome for carriers such as AirAsia Philippines and Philippine Airlines that have been looking to expand further at Mactan-Cebu International Airport. Philippine Airlines recently resumed six domestic routes from Cebu that had been cancelled in early 2014 under the leadership of San Miguel Corporation. Following the shift in management back to Lucio Tan Group, Philippine Airlines re-launched services at the end of March 2015 from Cebu to Butuan, Bacolod, Cagayan de Oro, Iloilo, Davao, and Tacloban.

Meanwhile, AirAsia Philippines has been concentrating on expanding its international operations from secondary cities in the country such as Cebu. The budget carrier sees potential to stimulate growth in underserved markets. AirAsia currently operates three domestic routes from Cebu to Manila, Davao, and Cagayan de Oro. The carrier also offers international services from Cebu to Kuala Lumpur, Kota Kinabalu, and Seoul.

AirAsia has increased its seat capacity in Cebu by 45 percent in the last year alone. According to the Centre for Asia Pacific Aviation, AirAsia Group now offers nearly 30,000 weekly seats from Cebu compared to just over 20,000 seats a year earlier. AirAsia has indicated that further expansion is intended for Cebu in 2015 including new international services to Singapore, Japan, and Hong Kong. 

AirAsia currently holds a 14 percent share of total seat capacity at the airport. Although competition from Cebu Pacific and Philippine Airlines is intense, AirAsia has plenty of room to expand in Cebu unlike at its primary hub in Manila.  

A total of thirteen carriers currently operate out of Mactan-Cebu International Airport with Philippine Airlines and Cebu Pacific, holding the largest share of seat capacity at present. The airport sees an average of 154 commercial aircraft landings and take-offs each day. In 2014, the airport served 6.84 million domestic and international passengers.

Oman Air Plans Daily Flights to Manila

After successfully launching service to Manila at the end of 2014, Oman Air has announced that it will be increasing its flights between Muscat and Manila from three to seven flights per week after a new agreement was signed with the Civil Aeronautics Board.

oman air philippines
Image Source: Times of Oman
According to the Civil Aeronautics Board, the new agreement becomes effective immediately on a provisional basis. "Oman Air will be increasing the number of flights to seven flights a week," said a Senior Official from the Civil Aeronautics Board. "The designated airlines of Oman and the Philippines shall be permitted to exercise full third and fourth freedom traffic rights on passenger or combination passenger and cargo services with not more than seven weekly frequencies between Manila and Muscat, using any type of aircraft except the A380."

Since launching service to Manila, Oman Air has concentrated primarily on the local Manila to Oman market with onward connections to Europe. However, the new memorandum of understanding permits Oman Air to exercise fifth freedom rights, which would permit the carrier to pick up and drop off passengers at one point in Thailand, Malaysia, or Indonesia.

The increase in flights will benefit overseas Filipino workers, who will now benefit from increased options for travel between the Middle East and the Philippines. Oman Air Chief Executive Officer, Paul Gregorowitsch, continues to be impressed by the Manila route's load factor, remaining confident that flights will continue to be added between the two cities.

According to the Centre for Asia Pacific Aviation, 38 percent of traffic on Oman Air's Manila to Muscat  route connect beyond Oman to other destinations in the Middle East and Europe. Paris is one of the most popular destinations, having seen a surge in passenger volume. 42 percent of passengers on the route are overseas Filipino workers, while an additional 20 percent are business travellers.

Meanwhile, the Civil Aeronautics Board reaffirmed that no Philippine carriers are currently planning to launch flights between the two countries. Last year, a report revealed that Cebu Pacific was considering launching service to Muscat as part of its long-haul low-cost network. Most recently, media reports have circulated that Philippine Airlines was also planning a new route to Muscat.

Oman Air recently entered into a new codeshare agreement with KLM Royal Dutch Airlines, enabling passengers connecting beyond Muscat to reserve flights operated by KLM to Amsterdam.