PAL raises fuel surcharge

Thursday, 12 August 2010 00:00
BY DARWIN G. AMOJELAR SENIOR REPORTER

FARES of Philippine Airlines (PAL) have risen after the government approved an increase in the flag carrier’s fuel surcharge for both domestic and international flights. The Civil Aeronautics Board (CAB) approved PAL’s request to increase its fuel surcharge to $42 from $35 in its Manila to Bangkok flights starting August 15.

“PAL is constrained to increase its fuel surcharge to enable it to partially recover the steady increase of the cost of fuel,” the airline said in a document filed with the regulator.

PAL said fuel prices rose 177.9 percent to $86.64 per barrel in July from its base reference of $31.18 per barrel in 2003.

The CAB also granted the request of PAL to extend a higher fuel surcharge up to October 12 to its Singapore flights at $29; Indonesia, $44; Hong Kong, $25; Macau, $19; Xiamen, $24; Beijing and Shanghai, $44.

PAL’s fuel surcharge for US and Canada stands at $109 per passenger; Australia, $109; Korea, $40; China, $44; Guam, $34;Singapore, $29 and Hong Kong, $25.

For its domestic destinations, the airline imposed a fuel surcharge of between P500 and P700.

A fuel surcharge is a temporary relief granted to airlines to help them recover losses they incur from higher jet fuel prices.

Fuel accounts for a third of an airline’s operating cost per passenger, and is the second-highest expense next to labor.

PAL’s costlier ticket is an additional burden to its passengers at a time when the carrier is suffering delays and cancellation of flights because of a lack of pilots.

Last week, PAL was forced to cancel several regional and domestic flights after 26 pilots flying its Airbus A319s and A320s resigned.

None of the 26 pilots who suddenly left their jobs have returned to their posts even as the airline gave them seven days to come back without sanctions.

This coincided with a planned strike by the Flight Attendants’ and Stewards’ Association of the Philippines
(Fasap) to protest what it called the carrier’s discriminatory age and gender requirements, as well as PAL’s failure to raise salaries for more than three years.

The carrier’s management had offered an P80 million one-time package to FASAP under their 2005-2010 collective bargaining agreement, but the union rejected the offer.