PAL implements business restructuring

Published February 28, 2020, 12:00 AM

by manilabulletin_admin

By Emmie Abadilla 

After incurring losses in 2019, Philippine Airlines is streamlining its business to boost revenues and reduce costs in the face of dampened passenger demand this year, with current travel restrictions and flight suspensions to COVID-19-affected areas.


Under the program, PAL implemented a voluntary separation initiative for long-serving employees and a retrenchment process completed on February 28, paring off about 300 ground-based administrative and management personnel from its workforce.

Affected employees will receive appropriate separation benefits, additional trip pass privileges, and assistance in the form of career counseling and outplacement support.

Other initiatives include generating revenues from an optimized route network and new ancillary products, more aggressive cost-management efforts, and investment in digital technology.

This February, PAL increased its authorized capital stock from P13 Billion up to P30 Billion, as part of its transformation to sustainable profitability and higher competitiveness.

Initially, PAL projected to be in the black by 2019 but has re-set its targets and expected to be profitable this 2020. It has also put on hold its ambition to be a five-star airline around this period.

The last time PAL showed profits was in 2016 when it netted P4.13 Billion, although net earnings fell 39 percent year-on-year at the time. The following year, parent firm PAL Holdings Inc. lost P7.3 billion due to higher expenses. The airline reduced its net loss to P4.33 billion in 2018.

PAL continues to be focused on managing the risks related to the COVID-19 situation, in the interest of public health and safety.

As part of its flag carrier duties, PAL brought home close to 500 Filipino seafarers of the corona virus-contaminated cruise ship Diamond Princess of the Sea from Haneda, Japan to Manila this week. The airline also carried out repatriation flights from Xiamen and Tokyo.

The flag carrier will continue to take delivery of additional aircraft for regional flights, and is gearing up to launch new Cebu-Los Angeles nonstop flights and routes to Perth, Pagadian, Kota Kinabalu and Manado.

Last year, PAL received deliveries of new aircraft in 2019, the last two Airbus A350-900s (Love Bus) – completing the long-range fleet – and a new 195-seat variant of the A321neo. It has a fleet of 97 aircraft todate.

This month, PAL is celebrating its 79th year of operations. It has been re-certified as a 4-Star airline in 2019 by ratings firm Skytrax. It was voted as the World’s Most Improved Airline of 2019 based on a global survey of more than a million passengers. The US-based Airline Passenger Experience (APEX) association also rated PAL a 4-Star Major Airline for 2020, based on customer votes.