Philippine Airlines president Ramon S Ang said the carrier is targeting a break-even result by the end of 2012, with the carrier to reassign aircraft and realign its network as part of cost-reduction efforts. Mr Ang, as reported by bworldonline.com and rappler.com, said around 90% of the carrier's services will be realigned by Oct-2012, adding, “Right now, there are many big aircraft used for short destinations or small aircraft used for long destinations, that’s why it wasn’t efficient. [There should be] a right aircraft for the right destination”. He however noted there would be no flight cancellations as part of the realignment, which is expected to result in USD300 million of annual fuel savings. "We will see the effect of that after three months… so by the end of December, we will break even,” Mr Ang said.
Philippine Airlines expects USD300m in savings from fleet redevelopment, breakeven by end of 2012
You may also be interested in the following articles...
Southeast Asia airline market sees more rapid growth & high international low-cost penetration rates
Southeast Asia continues to post some of the highest growth rates in the global aviation industry, driven primarily by expansion in the region’s booming low-cost sector.
LCCs now account for over 50% of capacity in Southeast Asia’s four largest domestic markets – Indonesia, Malaysia, the Philippines and Thailand. Even more impressively, LCCs have been able to rapidly claim about a 50% share in the intra-Southeast Asia international market.
But there has also been growth in 2013 at nearly all of the region’s flag carriers. A large portion of this growth has been on regional routes as full-service operators have been able to join the LCCs in taking advantage of the generally favourable economic conditions in Southeast Asia.
AirAsia seeks to turn around Philippines operation with new focus on Zest Air and Manila
AirAsia is attempting to turn around its struggling operations in the Philippines by closing its base at Manila alternative airport Clark and focusing on expansion at Manila Ninoy Aquino International Airport using slots held by new partner Zest Air. AirAsia is also seeking approval for Zest to adopt the AirAsia brand, giving the LCC group two carriers in the Philippine market but a single product.
AirAsia has struggled in the Philippine market since it launched Philippines AirAsia in Mar-2012. The new affiliate’s base at Clark has been highly unprofitable with limited growth opportunities.
Shifting focus to Manila significantly improves AirAsia Group’s outlook in the Philippines. But AirAsia will still need to overcome intense competition from market leader Cebu Pacific, which has a much stronger position at Manila, as well as the Philippine Airlines Group and Tigerair Philippines.