PAL is set to be one of Asia’s top airlines in the next few years

Prior to the pandemic, Philippine Airlines aimed to become a 5-star airline. This was, however, axed by the COVID-19 pandemic, which threw the airline into the red. After exiting chapter 11, it seems like PAL is out to start anew. With its new President and COO, Capt. Stanley Ng, at the controls of the airline, PAL is gearing up towards becoming one of Asia’s top airlines in the next few years to come.

This journey, however, will be difficult but doable. If you recall, PAL, a three-star airline at the time, set a goal of becoming a five-star airline in 2016. Skytrax, the world’s biggest airline rating body, finally recognized PAL as a 4-star airline in 2018. It was a feat that required a lot of fine-tuning and hard work.

The journey to be on top again will not be easy

During its 81st anniversary, PAL President and COO Capt. Ng said, “I want Philippine Airlines to be a full-service carrier. If everything is okay, Philippine Airlines will be among the top three airlines in Asia in the next three to five years.”

It will be a lofty goal, but it is entirely achievable. First and foremost, PAL is a very resilient airline. PAL has survived many world crisis thanks to the dedication of the crew and people behind the country’s main flag carrier.

The airline ended 2021 on a high note, exiting Chapter 11 bankruptcy protection voluntarily. This process enabled Philippine Airlines to reduce its debt by $2 billion, reduce its fleet by 25%, and raise $655 million. When combined with a relaxation of travel restrictions in its home country and elsewhere, the airline is off to a flying start this year.

Rebuilding pre-pandemic network and investing on systems

Currently, the priority of PAL is to rebuild and surpass its pre-pandemic capacity and to invest in systems and technology. PAL is investing in systems and processes to improve the passenger experience, improve back-end support, consolidate existing senior management teams, innovate digitally, and differentiate itself from competitors.

Following a 25% reduction in fleet size due to the recent Chapter 11 filing, PAL’s fleet utilization is currently very high, with the company operating at or above 80% of its total pre-pandemic capacity. PAL also continues to rehire retrenched cabin crew, and many of them have already returned to the airline.

PAL is also planning to expand its network of destinations. Years before the pandemic, PAL had planned to expand its network to include Tel Aviv, Chicago, Seattle, Milan, Frankfurt, and Male (Maldives). Only London made it through among its European destinations. It remains to be seen whether these destinations will be pursued in the future.

More improvements needed

PAL’s path to becoming Asia’s leading full-service airline is clear. PAL currently has an AirlineRatings.com safety rating of 7/7. This means that the airline exceeds the minimum aviation safety standards and is free of any safety concerns. This, I believe, is the most important factor because safety is always of the utmost importance in the aviation industry.

However, in the most recent 2021 Skytrax rankings, PAL dropped from 30th to 50th among the world’s top airlines. While this may not have a significant impact on its economy class sales, it may have a negative impact on its business class market. I believe that the efforts currently being made by Capt. Ng and the PAL team can gradually restore this. Furthermore, from 2020 to 2021, it was all about survival; no one cared about rankings.

PAL needs newer and more aircraft

It’s understandable that PAL had to return some of its newer A350s and 777s while keeping older A321s and A320s in service. The situation demanded survival mode, and I suppose this was the best way to survive. Unlike other global airlines, Philippine-based carriers had to deal with the pandemic on their own, with no help from the government. It was a difficult task, but they managed to complete it successfully.

However, if PAL is to become one of Asia’s top airlines, it will undoubtedly require newer aircraft with more consistent interiors. PAL is still waiting for 13 more Airbus A321neos. These, I believe, have regional interiors with 195 seats. Individual IFEs and business class seats are most likely. According to some unconfirmed reports, PAL intends to replace all A321ceos with A321neos. According to my sources, the A321ceos may be relocated to PALexpress. All remaining A320s will be decommissioned.

PAL needs to replace older B777 aircraft, such as RP-C7777 and RP-C7776, which will be 13 years old in November and January, respectively. PAL is also researching its future fleet, and one of the aircraft making the most noise is the Airbus A350-1000. If we are to recall, PAL still has 6 more Airbus A350 options. As the IATA strives for net-zero carbon emissions by 2050, there is also buzz about the Boeing 777-9X and the Airbus A330-900neo.

However, I hope that PAL will have a more consistent in-flight product in the future. At the moment, not all aircraft are outfitted with IFEs. Some A330s and all A321ceos remain empty. The bare and more densely packed A330-300s primarily fly Middle Eastern routes. PAL, on the other hand, now uses tri-class A330s on some Doha flights.

So much optimism for PAL

I am confident that PAL will be able to achieve its goal of becoming Asia’s top airline in the coming years. What matters right now is that PAL is making progress. The process may be slow, but it is taking place. It may take some time as the airline invests in new systems and technology to improve customer experience and speed up business processes.

It is essential to invest in the future to become a more sustainable and environmentally friendly airline.

PAL intends to remain a top full-service airline, so expect a better product if everything goes as planned. “There are a lot of low-cost carriers and a lot of full-service carriers, so where is Philippine Airlines in that?” said Capt. Ng. “We are here, and this is where we want to be, a top full-service carrier.”

There is no doubt that PAL has the potential to become one of Asia’s leading airlines. The process will take time, but it will succeed as long as there is consistency and progress.