PAL To Expand as EU Removes It from Blacklist

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With removal from the EU’s safety black list, PAL can now fully justify its acquisition of Airbus A330s (below) along with A321s. (Image: Airbus)
July 11, 2013, 12:28 PM

Philippine Airlines (PAL) has become the Philippines’ first and only carrier removed from the EU air safety black list, an operating ban imposed three years ago within the 28-state European Union (EU). Meanwhile, the U.S. Federal Aviation Administration has begun to reassess the Category 2 rating it issued to PAL in 2009. Category 2 carriers cannot start new services to the U.S. FAA safety inspectors arrived in the Philippines a few weeks ago, leaving PAL executives hopeful that they can soon proceed with plans to expand services into the U.S.

Civil Aviation Authority of the Philippines (CAAP) director-general William Hotchkiss said raising safety standards had required “superhuman effort,” including recruiting veteran talent.

The EU ban remains in effect on all other Philippines-based airlines. “We continue to closely monitor and conduct further review on other airlines such as Cebu Pacific,” Philippine EU Delegation Head Guy Ledoux said in Manila. Last month a Cebu Pacific flight skidded off the runway in Davao City, though passengers and crew disembarked safely.

PAL’s plans to launch European service in October include flights to Paris, London, Rome and Amsterdam, pAL President and COO Ramon Ang said. Tourism Secretary Ramon Jimenez said he expects PAL to bring 600,000 more visitors to the Philippines from Europe. “Looking forward, we are optimistic and confident that other Philippine carriers will progress in their committed endeavor to address their respective safety issues,”  Jimenez said in a statement. As the only carrier operating nonstop flights to Los Angeles and San Francisco, PAL also enjoys a captive customer base among Filipino-Americans.

In the process of modernizing its fleet, the airline placed an order last year for 10 Airbus A330-300s and 44 A321ceos and Neos. It plans to take 21 airplanes this year, including the first A321 in August. Considered a candidate for either the Boeing 777X and Airbus A350, it now operates a mix of 46 widebodies and single-aisle aircraft.

PAL recently forged ties with the Royal Group of Cambodia to establish its first international venture, Cambodia Airlines. PAL holds a 49-percent stake in the new carrier.

In a disclosure to the Philippine Stock Exchange, San Miguel Corp., which owns 49 percent of Philippine Airlines, said it had begun discussions with All Nippon Airways (ANA) for a possible investment in PAL. ANA recently ended its joint venture with budget Malaysian carrier AirAsia. In the words of AirAsia CEO Tony Fernandes, that relationship proved “a horrible experience” for his airline. “So we had a quick divorce,” he said.

 

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