PAL implements more cost-cutting measures

Expecting a more difficult business landscape in the next few years, the country’s flag carrier Philippine Airlines (PAL) has started to implement more cost-cutting measures anticipating the projected passenger decline and stiffer competition.

In an interview with PAL vice president for marketing support, Felix Cruz, he said that the airline will start to cut-down the wastage in the on-board loading,” extra weight means [extra] fuel-burned. There are [load] wastages that we can be cut down.”

He said PAL will start to cut-down on the load-factor, to offset the higher cost of fuel, and brace itself for the probable decline of passenger traffic, due to the softening of US economy.

“The softening US economy may affect the Asian dragons and they will soon be affected down the line,” Cruz stressed.

On the other hand, he assured that the airline will not compromise its cost-cutting measures to affect the more or less 8,000 PAL manpower saying workforce retrenchments are not in the airline’s drawing board.

While other giant airline companies in the United States are starting to down size their workforce to sustain the business amid the thinning passenger demand and high fuel prices, Cruz said PAL has to adopt other cost-cutting measures, other than personnel cut.

As the US economic slowdown, which would result to postponement of travel plans, coupled with the threatening effect of expensive fuel, he said the airline has to suck the losses to its internal pocket, than passing it off to consumers.

He said increasing ticket charges is not a wise mechanism right now in order to survive amid very tough competition.

However, it started to pass on the burden to passengers in implementing the decrease in maximum allowed baggage weight for trans-Pacific flights effective next month, from allowable 70 pounds, to 50 pounds.

Unnecessary weight inside planes is being removed to even as small as an extra copy of the operations manual, heavy magazines and even excess water in the plane’s reservoir.

“Most of the water we carry is not used up so we try to keep the water in a level that it’s maximized but still within safety limits,” Cruz said.

On the other hand, despite the cost-cutting measures, he said the airline still has to maintain its full-service standard saying the airline is servicing the “sophisticated travel market,” and that premium service on-board should not be compromised.

Meanwhile, PAL’s budget airline arm PAL Express will implement its full expansion plan this year, opening up flights in the Philippines’ missionary routes, making Cebu as the hub.

He said starting July 1, PAL express will open at least 12 flights out of Cebu—to different destinations in Southern Philippines.

All flights will utilize modern, 76-seater Bombardier Q400 turbo-prop aircraft, the flagship of the PAL Express fleet.—Ehda M. Dago-oc