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Tuesday, December 20, 2011

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Monday, December 19, 2011

Lower PAL Revenues

Manila Standard Today
December 19, 2011
By Jeremiah F. de Guzman

Philippine Airlines said revenues will likely be lower in the October-to-December period as a result of the labor strike staged by ground employees in September.

"Because of the strike, our third quarter performance will be affected in terms of revenues," PAL president Jaime Bautista said in an interview Friday.

He said operations were trimmed down in the middle of September as a result of lower employees serving PAL's thousands of passengers every day.

"There was even a time that our flights were down 20 flights a day," Bautista said.

But he said the number of flights were now averaging 150 flights a day due to a surge in passengers for the holiday season.

Bautista said the seasonally high load factor expected for November and December failed to offset the reduction in number of flights in October and early November.

"But we are now back to normal," he said.

PAL's international operations account for 70 percent of the airline's passenger revenue.

PAL to ferry relief goods to Cagayan de Oro and Dipolog for free


PAL flights to Cagayan de Oro and Dipolog will carry free of charge disaster relief donations coming from reputable non-government organizations (NGOs) and religious groups addressed to their designated recipients in Cagayan de Oro and Dipolog.

PAL Foundation Executive Director Carmen Sarmiento said, “As in past natural disasters, PAL is taking the initiative to bring donations as quick as possible to affected areas. PAL will fly relief goods up to January next year until those affected by typhoon Sendong in Cagayan de Oro and other parts of Mindanao are able to rebuild their lives.”

The Lucio Tan Group kicked off its relief operations by sending bottled water from Asia Brewery, Inc. to CDO via PAL. Its philantrophic arm, the Tan Yan Kee Foundation, is likewise ready to fly in relief goods to disaster areas.

Sarmiento said recipients of donations from nearby cities should send their representatives to the Cagayan de Oro and Dipolog airports to formally accept the goods.

PAL will carry the relief goods as cargo on any of the five daily flights to Cagayan de Oro and five weekly flights to Dipolog using the Airbus A320 and A319 aircraft.

Priority will be given to lightweight and non-bulky essential items such as medicines and foodstuff.
Interested parties may contact  the PAL Foundation by sending an email to menchu_sarmiento@pal.com.ph.

PAL to carry relief goods

Business World
December 19, 2011
By Kathleen A. Martin

 PHILIPPINE AIRLINES will be carrying relief goods to Cagayan de Oro and Dipolog cities free of charge, the company said in a statement yesterday.

"PAL will carry the relief goods as cargo on any of the five daily flights to Cagayan de Oro and five weekly flights to Dipolog using the Airbus A320 and A319 aircraft," PAL said.

The carrier said priority will be given to essential items such as medicines and food.

"PAL will fly relief goods up to January next year until those affected by typhoon Sendong in Cagayan de Oro and other parts of Mindanao are able to rebuild their lives," Carmen A. Sarmiento, PAL Foundation executive director, said in the statement.

The carrier said nongovernmental organizations, private companies, religious groups and other parties who will be sending relief goods to the devastated areas may contact PAL Foundation.

PAL, starting Nov. 24, restored full flight capacity in preparation for the holiday season after reducing flights in late September due to its outsourcing program.

PAL laid off its workers from the airport services, catering services, and call center reservations units, which is said to cost the airline some $10- to $15 million a year.

PAL was forced to roll out its spin-off program on Sept. 27 after some PALEA members stopped working instead of the planned Oct. 1 implementation.

Sunday, December 18, 2011

Vivienne Tan: ‘I always look forward’

Philippine Daily Inquirer
December 18, 2011
By Marge C. Enriquez

Philippine Airlines (PAL) would have celebrated its 70th anniversary this year with ample pomp and promos. Despite the recent strike by its personnel, the national flag carrier is dusting itself off and getting on with it.

“We decided to end the year with a big bang,” declares Vivienne Tan, PAL’s executive vice president-commercial group. “We’re flying all our routes again. Everything will be okay from hereon. Things will just get better.”

When PAL dangled its Christmas Ticket incentives, offering fares for as low as 70-percent off, people snapped them up and waited daily for news about its surprise perks. One customer got the Manila-Delhi flight worth $108 on the first day of the promo and was still happy to pay a total of $510 after the fuel surcharge and government taxes. That’s just the beginning of PAL’s sweet deals.

Entrepreneurial

“I always look forward,” says Tan. The interview is in her office. She puts on a beige tiered scalloped skirt teamed with a minimalist black DKNY blazer. Her favorite accessory, a Cartier man’s watch, peeps from her sleeve. A pair of gold-buckled, black Roger Vivier court shoes pulls together her corporate look.

The stylish look is a vestige of her fashion background.

In reality, says PAL’s strategist Joel Santos, Tan is a “nerd.” She studied math and computer science in San Francisco and set up her business. In the late ’90s, PAL chairman Lucio Tan, her father, asked her to come home and assist him.

At that time, the airline was undergoing expansion and refleeting, until it was hit by the Asian financial crisis and labor disputes which were subsequently resolved.

An entrepreneur at heart, Tan left the company to establish Entrepreneurs School of Asia in Quezon City until her father asked her to rejoin the airline last January.

Her department is tasked to build the PAL brand and oversee the passenger service. Hence, Tan has become the “face of PAL” in its reimaging.

“I studied the landscape of the airlines in the Philippines. PAL is the only full-service carrier. That means we don’t charge customers by the kilograms of their luggage. When you need water, tissue paper or more food between meals, we don’t charge you. Our seats are bigger than low-cost carriers. There’s value in their ticket.”

Brand distinction

Tan points out that customer service will serve as the essential brand distinction for PAL, as its fares would generally remain reasonable. She understands that the well-informed traveler will not only seek the lowest prices, but will also be faithful to the airline that treats him nicely.

“PAL was not being differentiated from other low-cost carriers. People only look at price points. We’re trying to establish the distinction. We provide after-flight services—like when your luggage gets misplaced along the way, we send it back to you free of charge. We apologize and compensate. If you’re a frequent flyer, you can redeem the benefits. Most important, when there’s a flight disruption, we don’t leave our passengers behind. We take care of them. Our passengers get more than what they pay for,” says Tan.

Loyalty

The proof of that was the recent wildcat strike which started last Sept. 28, coinciding with the onslaught of Typhoon Pedring. Employees sought to obstruct PAL’s outsourcing program that was to be implemented in October. Globally, outsourcing has been changing the way big companies and airlines work. PAL has been one of the last to adopt to this measure.

“One of the things that I saw in a lot of PAL employees was loyalty. They really love PAL; they don’t want to leave the company,” says Tan. “Even before, my dad didn’t want to outsource. He didn’t want to see people without jobs. He did many things to make the company survive,” she says.

PAL offered the employees generous separation packages and the option to join the outsourcing operation, which did not sit well with the union.

The strike involved the airport services staff and even the catering service was barricaded. Nonetheless, Tan’s department and other PAL managers went to Naia to assist their passengers. On the first day of the strike, all the flights were canceled. The stranded passengers were fed and provided with water from the family-owned Asia Brewery. PAL also checked them into hotels and booked them in other airlines.

“Vivienne was very decisive,” says Santos. “Her guiding principle is that the customer comes first.”

Santos says PAL had to bite the bullet since they bought the tickets at full prices, an industry practice when purchasing on the same day. “If the passenger was booked in our business class, we had to buy the business class ticket from Singapore Airlines,” he says.

By the second day, PAL started to slowly restore its schedules. “We fixed the flight schedules. We compelled the operations to speed things up for the passengers and made sure that they were attended to during the flight,” she says. The airline operations became fully operational by the end of November.

Although the official losses were estimated at P40 million, Tan considers the tarnished image as a more severe consequence.

“Trust is more important. When trust is ruined in a relationship, you have to woo them back. When you fly with us, we know we have certain responsibilities,” says Tan.

Winning people

Tan adds that, aside from PAL’s continuing innovative offerings, it will persevere in its tourism campaign. When the Miss Earth Pageant was moved from Bangkok due to the floods to the Philippines, Tan grabbed the opportunity to promote the airline and the country. Partnering with the Department of Tourism, PAL brought the delegates all over the country.

Their happy faces and endorsements of the Philippines were captured in a video which is being shown in countries where PAL is represented. The contestants were so bowled over by the Philippines and Filipinos’ hospitality that they volunteered to be spokespersons of the country.

The airline has also quietly invited influential people from other countries to visit the Philippines. It recently hosted a group of well-placed Indians to enjoy Manila’s golf courses and cosmopolitan night life, in the hope that the visitors would spread the word about the country.

Tan points out that PAL will continue its Pinoy Homecoming campaign, luring the younger generation of Filipinos to see their homeland. This year, among PAL’s guests were Bruno Mars and apl.de.ap. of Black Eyed Peas.

PAL is also partnering with the Ninoy and Cory Aquino Foundation in the We Can Be Anything campaign, a drive to build 10,000 classrooms. The airline is promoting this drive to the Filipino community in the US.

Although PAL wants to be bullish about its expansion, Tan reveals that some of its plans have to be delayed as the country’s aviation industry was downgraded to Category 2 by the Federal Aviation Administration.

(Category 2 indicates that the level of aviation administration provided by Philippine authorities does not meet the international standards set by the International Civil Aviation Organization.) Hence, PAL can’t add  flights or routes, especially in the US.

New planes

But it has nothing to do with the airline. In fact, PAL is the only airline in the country to be accredited with the International Airport Transport Association Operational Safety Audit; it was also given a satisfactory rating by Skytrax, the official airline review site.

Next year, PAL will launch two more Boeing 777s. More comfortable, fuel-efficient and eco-friendly, these new planes have been flying to Vancouver and Japan. There will also be more celebrations of PAL’s 70th anniversary in other countries and more surprises for its customers.

Says Tan, “What we’ve been doing is a foretaste of things to come, so that everyone will know we’re back.”


Tuesday, December 13, 2011

PAL unveils biggest Xmas Ticket Promo

Philippine Airlines (PAL) will launch tomorrow (14 December 2011) its biggest, longest and most exciting international and domestic ticket sale for the year titled “12 days of Christmas.” 


PAL is offering giveaway rates for all its international and domestic destinations for the next 12 days starting December 14 until December 26. Travel period is from January 10 to March 15, 2012. All tickets will earn double miles under PAL’s Mabuhay Miles program.

As a special treat, PAL will also offer daily surprise “add ons” or “sweeteners” on top of attractive promo fares. Passengers are advised to watch out for daily announcements on print, radio, the PAL website and Facebook for the latest updates on freebies. Seats are limited and are on sale on a “first come, first served basis”.

Based on the promo mechanics, roundtrip tickets to the following destinations are priced accordingly (excluding fuel surcharges and government taxes): Beijing US$80; Shanghai US$60; Xiamen US$50; Delhi US$108; Sydney US$298; Melbourne US$298; Manila-Tokyo US$248; Cebu-Tokyo US$298; Nagoya US$248; Fukuoka US$248; Osaka US$248; Honolulu US$308; Guam US$228; Bangkok US$48; Saigon US$48; Singapore US$48; Jakarta US$48; Hong Kong US$30; Macau US$30; Taipei US$30; Las Vegas US$498; Vancouver US$498; Los Angeles US$498; San Francisco US$498; All Luzon – Economy P788, Business Class P3,988; All Visayas  - Economy P788, Business Class P3,988; and all Mindanao – Economy P1,388, Business Class P4,988.

Vivienne Tan, PAL executive vice president-commercial group said the promo is the flag carrier’s way of thanking passengers for their loyal and continuing patronage especially on the flag carrier’s 70th annniversary.
“PAL’s schedules and services are back to normal. We’re launching the biggest and longest promo to end the year with a bang. Families can extend their holidays since this promo allows everyone to travel right away starting January 10. It’s truly a Merry Christmas and Happy New Year!” Tan said.

For more details about these special deals, please log on to www.philippineairlines.com, call PAL Reservations at 855-8888 or visit your nearest travel agent.

Friday, December 9, 2011

PAL seen ending 2011 in the red

Philippine Daily Inquirer
December 19, 2011
By Paolo G. Montecillo

MANILA, Philippines—Flag carrier Philippine Airlines is expected to end the year in the red due mainly to labor woes and high fuel prices.

PAL president and chief operating officer Jaime J. Bautista said making matters worse for airlines across the world were the economic woes in the United States and Europe and the natural crises in Japan, which have dampened demand from developed markets.

“Our numbers are down by an average of 20 percent for the months affected by the strike,” he told reporters.

Bautsita said the strike by PAL Employees’ Association (Palea) in late September, in protest of the company’s plan to retrench 2,600 workers, forced the airline to scale down flights for several weeks.

The workers who went on strike have since been retrenched, but the sub-contractors hired by PAL have not been able to replace the fired employees.

Bautista said the airline had been suffering from the impact of the strike since October and this might continue up to early next year.

He said the unannounced strike by Palea had led to a slowdown in bookings, with many potential customers scared off by the possibility of further disruptions in flights.

As a result, he said the company’s average load factor had slumped to about 70 percent, which meant that close to a third of seats in every PAL flight is vacant.

Most affected are PAL’s domestic flights, which make up a third of PAL’s operations. Demand for international flights remained stable, Bautista said.

Last month, PAL, owned by taipan Lucio Tan, reported a net loss of $39.4 million for the three-month period ending September, a reversal from its $27.6-million profit a year ago.

The cost of fuel, which accounts for about 40 percent of the company’s expenses, also continues to threaten PAL’s profitability.

“The jet fuel price assumption in our budget is around $120 per barrel. Right now, it’s at about $126 per barrel,” he said.

Thursday, December 8, 2011

PAL, Chartis expand travel insurance to all passengers

Philippine Airlines and Chartis Philippines Insurance, Inc. have expanded their partnership by now making travel insurance available to all PAL passengers, adding another benefit to flying with the national flag carrier.
Previously, only passengers who booked their PAL flights online via the airline’s website www.philippineairlines.com were offered the option to purchase travel insurance from Chartis.

Beginning this quarter, those who book flights through PAL’s reservations call center and ticket offices or at accredited travel agencies can avail of Chartis travel insurance by simply logging on to www.philippineairlines.com/protectyourtrip.  Coverage is also broadened to include those who booked online but initially opted out of the insurance offer; they’re now given a further opportunity to add the product to their itinerary.

Through Chartis’ affordable policies starting from P200, passengers can protect their trip from travel inconveniences such as lost documents, rescheduled flights and even medical emergencies.
The exclusive product offered by Chartis to PAL passengers is available for all flight bookings originating from the Philippines.  With 90 years of history and jurisdiction in over 160 countries, passengers can be assured of Chartis’ comprehensive coverage for all their trips.

To learn more about travel insurance, visit www.philippineairlines.com/insurance.

Sunday, November 20, 2011

PAL to use bigger jets to boost underground river tourism

By Tina G. Santos
Philippine Daily Inquirer


MANILA, Philippines—National flag carrier Philippine Airlines has vowed to promote the Puerto Princesa Underground River (PPUR)—now included in the provisional list of winners in the recently concluded online global search for the new Seven Wonders of Nature—by using bigger jets to bring in more tourists.

This is apart from PAL’s promotional activities in the Philippines and abroad, said airline president and chief operating officer Jaime Bautista.

“In support of  Puerto Princesa Mayor Edward Hagedorn’s program to attract more tourists, we will fly our bigger planes to Puerto Princesa,” said Bautista in a statement, adding that PAL was teaming up with the city government to maximize the tourism potential of the PPUR.

He said PAL would deploy wide body jets like the Airbus A330 to Palawan to accommodate the expected influx of tourists to the city after its underground river won global recognition.

At present, PAL flies twice daily to Puerto Princesa using an Airbus A320.

Hagedorn said the interest of tourists, both foreign and local, in the underground river had been greatly aroused by its new-found international fame.

Bautista said Palawan’s underground river was included in the top six destinations in PAL’s 2012 corporate calendar.

“This is how important PAL regards this wonderful destination,” he said.

Timely renovation
According to Bautista, the recent’ renovation and expansion of the Puerto Princesa airport was timely as it could now accommodate bigger aircraft.

Aside from the Puerto Princesa airport, other provincial airports that can accommodate bigger aircraft are those of Cebu, Davao and Iloilo.

Earlier this month, the PPUR was named one of the new Seven Wonders of Nature, along with the Amazon rainforest, Vietnam’s Halong Bay, Argentina’s Iguazu Falls, South Korea’s Jeju Island, Indonesia’s Komodo, and South Africa’s Table Mountain.

Hagedorn, for his part, credited PAL with helping develop and boost Palawan’s tourism industry. He said that back when Palawan was considered a missionary route, PAL was already flying to the island.

He noted that there used to be only two to three flights a day to Puerto Princesa. Now there are 11 flights a day, unloading not only local residents but mostly foreign tourists.

Last year, around 425,000 tourists visited the underground river. The city government expects some 550,000 visitors this year.

Already a Unesco World Heritage Site, the underground river is located in Barangay Sabang, 81 kilometers north of the city.

Longest in Asia
Also known as the St. Paul or Puerto Princesa Subterranean River National Park, the underground river runs 8.2 kilometers inside a limestone mountain. It is believed to be the longest underground river in Asia. While navigating the underground river, one can see formations of stalactites and stalagmites that had developed over 20 million years.

Known as the Philippines’ last biodiversity frontier, Palawan also has white-sand beaches, lush forests, wildlife parks and other natural wonders.

Saturday, November 19, 2011

PAL losses widen to $39.4M in July-Sept

By Mary Ann LL. Reyes  
(The Philippine Star) 
Updated November 19, 2011 12:00 AM

MANILA, Philippines - Philippine Airlines (PAL) posted total comprehensive losses of $39.4 million in the second quarter of its fiscal year (July to September 2011) due mainly to skyrocketing jet fuel prices.

In a filing with the Securities and Exchange Commission (SEC), PAL said its second quarter losses was from the total comprehensive income of $26.7 million recognized in the same period in 2010.

The airline said total revenues reached $420.4 million, reflecting a 4.7 percent improvement over the year-ago figure of $401.6 million for the same three-month period.

However, total expenses went up by $84.8 million or 22.6 percent to $459.7 million for the second quarter of 2011. Jet fuel, which remains the airline’s biggest expense, contributed the largest increase at $48.3 million or 33.9 percent from $142.5 million in 2010 to $190.8 million for the current three-month period. Average jet fuel prices rose from $94.92 per barrel to $131.99 per barrel.

PAL reported that based on data released by the International Air Transport Association (IATA), the airline industry in general achieved growth in passenger traffic year-on-year as of September 2011 by an average of 6.3 percent. However, operating results in recent months are showing a decline in both passenger and cargo traffic, reflecting a reluctance for both business and leisure travel spawned by problems in the US and European economies.

Going forward, IATA reports indicate more difficult times ahead for the airline industry as various countries continue to be plagued with economic uncertainty and costs are rising with not much room to increase yields.

PAL incurs loss in 2Q on higher fuel costs

The Manila Times
November 19, 2011
By Darwin G. Amojelar

PHILIPPINE Airlines on Friday said it suffered a net loss in the second quarter of its fiscal year ending March next year mostly because of skyrocketing jet fuel costs.
In a filing with the Securities and Exchange Commission, PAL said its total comprehensive losses in the July to September period amounted to $39.4 million, higher than the $26.7-million net loss in the same period last year.

Revenues reached $420.4 million, reflecting a 4.7 percent improvement over the year ago figure of $401.6 million for the same three month period.

Expenses grew 22.6 percent year-on-year to $459.7 million.

Jet fuel, which remains the flag carrier’s biggest expense, contributed the largest increase at 33.9 percent from $142.5 million in 2010 to $190.8 million for the current three-month period. Average jet fuel prices rose from $94.92 per barrel to $131.99 per barrel this year.

Citing data released by the International Air Transport Association, PAL said the airline industry in general achieved growth in passenger traffic year-on-year as of September by an average of 6.3 percent.

However, operating results in recent months are showing a decline in both passenger and cargo traffic, reflecting a reluctance for both business and leisure travel spawned by problems in the US and European economies. Going forward, IATA reports indicate more difficult times ahead for the airline industry as various countries continue to be plagued with economic uncertainty and cost-induced yield compression.

Monday, November 14, 2011

LAST CALL: Selling ends midnight

LAST CALL: Selling ends midnight! Book one-way domestic for as low as PHP588, round-trip regional USD50 and round-trip international USD508. Travel is good on November 16 to December 15, 2011. Taxes and surcharges apply. Click the link below for more information.

PAL Special Offers

Have you booked yet? Travel one-way domestic for as low as PHP588, round-trip regional USD50 and round-trip international USD508. Book these deals for travel November 16 to December 15, 2011. Taxes and surcharges apply. Click the link below for travel options.
http://www.philippineairlines.com/special_offers/special_offers.jsp

Lipat na, Lipad pa!

Transfer your balance and get free Philippine Airlines flight with Mabuhay Miles MasterCard.
Get as much as 30,000 Mabuhay Miles* and fly for FREE when you apply now and balance transfer! *When you balance transfer P50,000. Call Ally Live at 818-9-818 or DTF 1800-10-818-9-818 for more details

Saturday, November 12, 2011

PAL Midnight Special

Flying TO MANILA on November 16 to December 10, 2011? Click the link below to get a deal for flights FROM ASIA. Midnight Special runs 7pm Saturday to 7am Sunday.
http://www.philippineairlines.com/special_offers/latest_offers/midnight_special.jsp

Friday, November 11, 2011

Philippine Airlines Special Offers

Visit Puerto Princesa until December 15, 2011 for as low as PHP988 with our DOMESTIC PAYDAY SPECIAL. Price for other destination starts at PHP588. Visit the link below for more options.
http://www.philippineairlines.com/special_offers/special_offers.jsp

Philippine Airlines plans to resume domestic expansion and looks for green light from US regulators

Philippine Airlines (PAL) is not ready to abandon the domestic market – at least not yet. The floundering flag carrier, which has seen its share of the Philippine domestic steadily slip in recent years, plans to add back some domestic capacity in 2012 as its previously-reduced A320 fleet expands again by four aircraft.

International capacity will also be up in 2012 as PAL takes its next batch of B777-300ERs. PAL is banking on the Philippines regaining next year a Category 1 safety rating from the US FAA, which is necessary for the carrier to deploy B777-300ERs on US routes as planned. Continued restrictions on US routes is one of several challenges PAL faces as the carrier also tries to overcome increasing competition from LCCs and continuing worker protests.
As CAPA reported late last month, the LCC penetration rates in the Philippine domestic market has grown since 2005 from less than 50% to about 80%, driven by a combination of rapid expansion by the country’s low-cost carriers and contraction at PAL. Philippine CAB figures show PAL accounted for only 24% of domestic passengers in 2Q2011. PAL’s share of the market has slipped even further since late September, when a strike was waged by ground staff employees affected by PAL’s decision to outsource non-core functions including catering and call centre.

PAL's domestic operation has been pared back to only 60 daily flight since late September

Protests against the now implemented outsourcing plan continue, with striking employees having taken possession of PAL’s catering facility in Manila. PAL was able to quickly resume its full international schedule, using catering services from other vendors, but has not yet fully resumed its domestic operation. PAL president Jaime Bautista told CAPA on the sidelines of last week’s Association of Asia Pacific Airlines (AAPA) Assembly of Presidents in Seoul that the carrier is only operating 60 daily domestic flights, down from a pre-strike schedule of 140 flights per day.

Overall PAL is now operating 90% of its normal schedule, compared to only 20% the first day of the strike and 40% on subsequent days. The 10% of flights that remain cancelled are all domestic.

The Philippines’ three domestic LCCs have been hoping that PAL sticks permanently to the reduced schedule, resulting in an even further increase in the LCC penetration rate. But Mr Bautista says PAL still intends to return its domestic schedule to the pre-strike level. He says PAL also plans to increase its domestic schedule in 2012 as it takes delivery of four additional A320s.

Mr Bautista says PAL currently has an A320 family fleet of 16 aircraft (12 A320s and four A319s), down from 22 aircraft a few years ago. The smaller fleet has resulted in dramatic domestic capacity reductions as PAL has not cut its regional international operation, which primarily uses A320s with some routes, such as Hong Kong, utilizing widebody aircraft.

PAL and AirPhil independently expand A320 fleets

PAL’s A320 fleet has shrunk over the last two years as six A320s have been subleased to AirPhil Express, an LCC with the same primary owner as PAL. AirPhil has been steadily increasing its domestic operation as PAL has downsized domestically. AirPhil, which coordinates schedules and has a limited codeshare with PAL, plans to grow its A320 fleet from eight to 15 A320s by the end of 2012. But AirPhil is not sourcing any of its additional aircraft from PAL.

Mr Bautista says PAL has A320 deliveries slated for next April, June, August and November, resulting in a fleet of 20 A320 family aircraft by the end of 2012. He says about half of the additional capacity generated by this aircraft will be directed to the domestic market and half will be directed to the international market.
The resulting domestic capacity expansion will be relatively modest as all three of the country’s domestic LCCs – AirPhil, Cebu Pacific and Zest Air – are also planning significant capacity increases next year. But at least PAL’s expansion will keep it from continuing to rapidly lose market share and stay at or slightly above the 20% threshold domestically.

Capacity share by carrier type in Philippines domestic market (based on seats per week for 7-Nov to 13-Nov-2011)

In addition to the four A320s, PAL has two B777-300ER deliveries slated for 2012. Mr Bautistia says these aircraft will be delivered in June and November. PAL currently operates two leased B777-300ERs and has four more of the type on order with Boeing.

PAL initially committed to acquiring the six B777-300ERs in early 2008, with the anticipation of using the type to replace A340s and B747s on its flights to the US and Canada. But so far PAL has only been able to use its initial fleet of two B777-300ERs on three weekly flights to Vancouver as airlines from countries with Category 2 ratings are unable to add flights to the US or change gauge on existing flights. The FAA downgraded the Philippines from Category 1 to Category 2 only a few months after PAL committed to acquiring the six B777-300ERs.

As CAPA reported in Jul-2011, PAL needs the B777-300ERs to improve its product to the US and eliminate the need for a fuel stop on westbound flights. PAL now uses its ageing B747-400 fleet to operate daily flights to Los Angeles and San Francisco. PAL uses A340-300s to operate three weekly flights to Honolulu and four weekly Manila-Vancouver-Las Vegas flights (PAL has daily flights to Vancouver but can only use B777-300ERs on the three weekly flights that do not continue to Las Vegas because PAL is unable to operate B777-300ERs to the US).

PAL took the unusual step earlier this year to pay for a US consulting firm to help Philippine civil aviation authorities raise their safety standards in an attempt to meet Category 1 requirements. Mr Bautista now says he is hopeful of an upgrade to Category 1 by November, when PAL takes its fourth B777-300ER.

PAL banking on using B777-300ERs on US flights from 4Q2012

Mr Bautista says the upgrade to Category 1 is not necessary before 4Q2012 because PAL plans to deploy its third B777-300ER on flights to Australia and Japan. If the Philippines remains in Category 2 in Nov-2012, Mr Bautista says PAL will have to use its fourth B777-300ER on Asian routes. Clearly this is not an ideal situation as the B777-300ERs are best suited for long-haul routes and are significantly more efficient than the A340s and B747s PAL now uses for its US routes. PAL has experimented with having its B777-300ERs serve Australia, but reverted back to old schedules after finding the capacity increase over A330s, its previous equipment, was too much and the market wanted daily flights.

PAL is also banking on expanding its US network following the delivery of its fifth and sixth B777-300ER in 2013. But this is similarly contingent on Philippines returns to Category 1. As PAL faces increasing competition from LCCs domestically and in the regional international market, expansion of the carrier’s typically profitable US operation could be critical to its long-term term survival.
North American routes now account for 20% of PAL's weekly seats and 45% of its weekly ASKs.
PAL international capacity (ASKs) by region, for week of Nov-7-2011 to Nov-13-2011

PAL looks to use AirPhil to better compete with Cebu on regional international flights

Within Asia, PAL will continue to expand in an effort to maintain its market share on regional international routes. Mr Bautista says PAL believes there is room for AirPhil, which now has a very small international operation, to expand in the regional international market without risk of cannibalizing PAL’s own business. He says the idea is for AirPhil to focus on the lower end of the market, providing new competition for Cebu Pacific, while PAL focuses on the full-service sector.

The regional international LCC market is now dominated by PAL rival Cebu Pacific and to a lesser extent foreign LCCs. It is also being targeted by new local LCCs including Philippine AirAsia, which is planning to launch services in early 2012, and SEAir’s Tiger-branded A319 operation.

International expansion at AirPhil will also help AirPhil increase utilization of its A320 fleet, thereby reducing costs. Cebu Pacific currently enjoys a large cost advantage over the country’s smaller LCCs.

AirPhil now follows a hybrid model but Mr Bautista expects the carrier will start pursuing a purer LCC model as it strives to lower its costs. AirPhil’s codeshare with PAL will continue but Mr Bautista points out that it is a one-way codeshare with PAL only selling tickets on AirPhil’s turboprop flights. AirPhil took over PAL’s turboprop operation in 2009, when the carrier was still known as Air Philippines and following more a legacy carrier model.

AirPhil’s fleet of Dash-8 turboprops are used to serve airfields which cannot accommodate jets, including Caticlan – the gateway to popular tourist destination Boracay island. The codeshare service to Boracay and some other tourist islands is important for PAL to maintain connections to its international network, particularly for high end leisure passengers.

Mr Bautista said during the CEO panel discussion at last week’s AAPA assembly that the “low cost market will continue grow in Asia-Pacific, especially the Philippines”. The budget market in the Philippines remains relatively untapped because only 10% of the population currently flies.

Low costs are needed for PAL to fend off increasing competition from LCCs 

As most passengers in the Philippines are budget-conscious and competition with LCCs is already fierce, PAL also has been striving to lower its cost structure. The outsourcing of non-core functions is an important step for PAL as it significantly reduces headcount, which has historically been unnecessarily high.

Mr Bautista said during last week's assembly that the continuing protests from ground worker unions is no longer having a significant financial impact on PAL, which is expected to report late this month its earnings for the quarter ending 30-Sep-2011. “What’s really important is service that is provided has been downgraded in terms of catering. We are asking our passengers for their understanding,” Mr Bautista says.

PAL has been forced to use alternative vendors, resulting in a decreased level of service on flights departing Manila, as it still does not have access to its catering facility. PAL is now working with government authorities to try to remove the striking employees so it can regain access to its catering facility.

Mr Bautista pointed out that PAL’s plan to outsource non-core functions was approved twice by the country’s labor secretary and twice by president. “The problem is even with government approvals there are many groups and institutions that are against outsourcing,” Mr Bautista says. “It’s unfortunate we don’t get much support from our authorities.”

PAL Davao flights now back to normal

By Carmelle Marie Harrow
Wednesday, November 9, 2011

THE Philippine Airlines (PAL) is now operating normally after a month of flight disruption due to labor restiveness, an official said Wednesday.

Guesting in Wednesday's Club 888 forum at the Marco Polo Hotel, Lawyer Domingo Duerme, vice president for Mindanao operations, was happy to announce that normal flights schedules are back in place.

"We now have four flights out of the city and we would like to thank our valued customers who continue flying with us," Duerme said.

He assured travelers that PAL's flight has normalized and that passengers will surely reach their destinations without any flight disruption from this day onwards.

The four flight schedules are at 7:10 a.m., 11:50 a.m., 6:20 p.m., and 10:10 p.m.

While Fernando Mandanas, PAL Davao City branch manager, said they are now preparing for the December peak where most students, balikbayans and vacationing workers abroad come home for the Holiday season.
"Usually this happens during the third week of December and on the first week of January. This is the time that outbound flights will double up," Mandanas said.

He added that there are sufficient flights to augment the market on these months.

"We are a legacy airline and we provide convenience and comfort to our passengers and we will continue to uphold this," Duerme said.

Published in the Sun.Star Davao newspaper on November 10, 2011.

Thursday, November 10, 2011

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More PAL flights return to NAIA-2

Business Mirror
November 10, 2011


MANILA, Philippines - Philippine Airlines (PAL) said 6 flights will return to the Ninoy Aquino International Airport Terminal 2 (NAIA-2) on Thursday, more than a month of using NAIA Terminal 3 as part of its transition period for its outsourcing program.

Effective November 10 (Thursday), the following flights will be operating in NAIA-2:

PR391/PR392  Manila-Tacloban-Manila
PR393/PR394  Manila-Tacloban-Manila
PR187/PR188  Manila-Cotobato-Manila

However, the following 18 flights will remain in NAIA-3 until further notice:

PR123/PR124  Manila-Zamboanga-Manila
PR291/PR292  Manila-Dumaguete-Manila
PR163/PR164  Manila-Ozamiz-Manila
PR167/PR168  Manila-Dipolog-Manila
PR133/PR134  Manila-Bacolod-Manila
PR293/PR294  Manila-Dumaguete-Manila
PR157/PR158  Manila-Bacolod-Manila
PR125/PR126  Manila-Zamboanga-Manila
PR135/PR136  Manila-Bacolod-Manila

PAL flights departing from NAIA-3 in the morning PR123, PR291, PR163, PR167 and PR133 are checked in at island C (counters C06 to C14).

The afternoon flights in the same terminal, namely: PR293, PR157, PR125 and PR135 are checked in at island A (counters A17 to A23).

PAL files criminal charges vs 41 PALEA members

Business Mirror
November 10, 2011



MANILA, Philippines - Philippine Airlines (PAL) on Wednesday filed criminal complaints against 41 former employees, who allegedly harassed airline staff and blocked two of its catering vehicles from leaving the PAL Inflight Center in Pasay City last October 29.

PAL security officer Zenas Agbay, who was the ground team leader on October 29, submitted his affidavit-complaint against the 41 members of the Philippine Airlines Employees Association (PALEA)  to the Pasay City prosecutor's office at around 4 p.m. Wednesday.

In his complaint, Agbay recounted the events that led to the "unprovoked harassment" and detailed "specific acts of violence committed by PALEA members." The complaint included photographs and video footage of the incident.

Named respondents in the complaint were PALEA members: Jonas A. Agustin, Renato L. Berongoy, Jorge P. dela Rosa, Anacorito T. Fernandez Jr., Joaquin C. Galvez, Joaquin Z. Garcia, Eduardo O. Lapuz, Liberato B. Liad, Daniel C. Mag-atas, Celito V. Padon, Roselito A. Prado, Ronald R. Salazar, Romeo M. Sayas, Jose A. Amador, Alberto U. de Guzman, Edgardo J. Disu, Eusebio F. Flores, Sofronio S. Gajo, Nicanor R. Guantero, Jose Lito T. Lune, Bienvenido D. Luteria, Ricky R. Magararu, Ramon Patrick L. Salud, Froilan S. Tancinco, Arnel R. Amador, Epifanio M. Bagsic, Esther A. Gonzaga, Joseph Louie V. Macatual, Antonio N. Metiam, Danilo P. Musni, Manuel O. Narte, Rolando P. Oxina, Elmer L. Pinlac, Jaime Antonio D. Nacar Jr., Sarah Bonnin, Ariel Banagua, Jonas Agustin, Lauro Villanueva, Ulysis Rodelas, a certain Macatangay and a certain Colo.

PALEA members have been protesting the outsourcing program and began their blockade of the PAL Inflight Center along MIA Road on September 28. The center houses the airline's cabin services department and kitchen for meals for all PAL flights.

PALEA members allegedly harassed and threatened the airline's trucks and drivers, including those employed by the service providers, each time they leave and enter the PAL compound.

On the morning of October 29, 2 PAL vehicles loaded with trolleys, catering equipment and supplies were about to leave the compound when PALEA members blocked  it.

The protesters were armed with rattan batons and torches, and had even placed planks with nails on the driveway. Agbay said the PALEA members shouted invectives and threats at the drivers and security personnel.

"To make matters worse, the PALEA members poured liquid combustible material in a box and it was lighted about two feet away from the catering truck.  When it was already burning, they pushed it nearer the hood of the truck, endangering the truck and its occupants.  They also laid out barbed wires on the path of the vehicles," the complaint said.

Agbay said the requisite elements of grave coercion were present during the October 29 incident: violation of the law, presence of violence/threat/intimidation, and protesters had no authority to block the truck. As evidenced by photos and a video, the protesters threatened to torch the PAL truck.

Wednesday, November 9, 2011

More PAL flights return to terminal 2

Philippine Airlines
November 9, 2011

Six more flights will revert its operations back to terminal 2 after utilizing terminal 3 as its homebase for over a month since the start of the transition period of PAL's outsourcing program. October 1, 2011 was the start of the transition phase of the spin off program covering three non-core units, namely: Airport Services, Inflight Catering and Reservations.

Effective 10 Nov 2011, Thursday, the following flights will be operating in T2. These are:

• PR391/PR392  MNL-TAC-MNL
• PR393/PR394  MNL-TAC-MNL
• PR187/PR188  MNL-CBO-MNL

The 3 outbound and 3 inbound flights comprise the latest batch of flights which will operate anew in T2, starting tomorrow. As service providers gradually meet manpower requirements, more flights are expected to follow suit and revert back to T2.

Meanwhile, the following flights (18) will remain in T3 until further notice.

These are: PR123/PR124  MNL-ZAM-MNL; PR291/PR292  MNL-DGT-MNL; PR163/PR164  MNL-OZC-MNL; PR167/PR168  MNL-DPL-MNL; PR133/PR134  MNL-BCD-MNL; PR293/PR294  MNL-DGT-MNL; PR157/PR158  MNL-BCD-MNL; PR125/PR126  MNL-ZAM-MNL and PR135/PR136  MNL-BCD-MNL

PAL flights departing from terminal 3 in the morning, namely: PR123, PR291, PR163, PR167, PR133 are checked in at island C (counters C06 to C14) while PAL's afternoon flights in the same terminal, namely: PR293, PR157, PR125, PR135) are checked in at island A (counters A17 to A23).

Philippine Airlines Advisory

ADVISORY: Effective November 10, 2011, only flights to/from Bacolod, Dipolog, Dumaguete, Ozamiz and Zamboanga shall operate in NAIA Terminal 3. All other PAL domestic and international flights shall depart/arrive in NAIA Terminal 2.

Tuesday, November 8, 2011

PAL urges biz groups to join ranks, protect interests

Philippine Airlines
November 8, 2011

Philippine Airlines (PAL) urged the country's business community to be more vigilant against acts of violence by dismissed workers similar to the October 29, 2011 incident at the PAL Inflight Center.
This developed as PAL called on government to safeguard the constitutional rights of employers against abusive former workers.

After showing photo evidence in full-page newspaper advertisements of the blockade of a PAL truck by outsourced PAL employees, PAL said other companies are susceptible to similar mob rule due to the absence of adequate government protection.

Police have yet to charge any of the terminated employees for blocking or attempting to torch a PAL truck last October 29.

PAL reiterated its call for immediate government action versus a minority group whose acts are hampering the flag carrier's return to full normal operations.

PAL said the lack of adequate laws protecting businesses from violent acts of dismissed workers has emboldened former PAL employees into escalating their protests from rallies and marches to threats of bodily harm and destruction of property.

Earlier, the Employers Confederation of the Philippines (ECOP), Federation of Philippine Industries (FPI), Federation of Filipino-Chinese Chambers of Commerce and Industry (FFCCCI) and Philippine Chamber of Commerce and Industry (PCCI) issued separate statements urging government to prevent further escalation of harassment and violence at PAL which had been deemed inimical to investor confidence in the country.

The business groups said increasing number of incidents of harassment inflicted on PAL employees and equipment is "not conducive to business and could discourage investors."

The ECOP, FPI, FFCCCI and PCCI urged government to protect the rights of business in the same way that workers' rights are protected by existing laws.

Philippine Airlines Advisory

ADVISORY: Effective November 10, 2011, all international and domestic flights shall operate in NAIA Terminal 2 EXCEPT flights to/from Bacolod, Dipolog, Dumaguete, Ozamiz and Zamboanga, which shall remain in NAIA Terminal 3.

Tyranny at PAL Inflight Center

by Philippine Airlines on Tuesday, November 8, 2011 at 10:23am
 
Just before six in the morning on October 29, 2011, a Philippine Airlines truck was about to leave the PAL Inflight Center along MIA Road, Pasay City enroute to the airport.

Without provocation, scores of former PAL employees armed with rattan truncheons, wooden planks with nails, barbed wire and lighted torches blocked the vehicles from leaving the facility.

The protesters shouted invectives, parked their vehicles in front of the gate and set ablaze a gasoline-soaked carton box, all with the intention of barring PAL's truck from leaving the premises.

The following photo essay shows how protesting former PAL workers violated the law with impunity to deny PAL of its Constitutional right to free and unhampered use of its own equipment and facility.

To make matters worse, these workers have the temery of accusing PAL management of harassment. Pictures don't lie. Let the public be the judge.

 

Monday, November 7, 2011

Finance dep’t argues against airline tax breaks

Business World
November 7, 2011

THE GOVERNMENT should not provide tax breaks to international carriers since this would be unfair to domestic competitors charged similar taxes abroad, a Finance department official said.

“Foreign airlines are charged common carriers’ tax and gross Philippine billing tax but our local airlines are also charged different kinds of taxes in other countries,” Finance Undersecretary Gil S. Beltran said on Friday.
Flag carrier Philippine Airlines (PAL), in a letter to the Department of Finance (DoF), identified the array of income, business and percentage taxes it pays in other countries where it operates.

Australia, Canada, China, Indonesia, Japan, Singapore, Thailand, the United States and Vietnam were said to all charge a corporate income tax, with rates reaching as high as 30% of revenues generated in that particular country, the letter stated.

Value-added taxes (VAT) are likewise levied in Japan, Thailand and Vietnam, while goods and service taxes are imposed in Canada and Singapore. The US also charges a franchise tax, while China requires business taxes and local taxes.

“It is discriminatory to our domestic carriers, as represented by PAL, for the government to lift taxes on international carriers while they pay these taxes for their operations abroad,” Mr. Beltran said.

Foreign airlines, through the Joint Foreign Chambers, have been urging the government to stop charging the 2.5% gross Philippine billing tax and 3% common carriers tax imposed on gross receipts. This came as Air France-KLM, the sole European carrier operating in the Philippines, announced that it would phase out direct flights between Manila and Europe due to the heavy tax burden.

The international carriers were supported by various leaders in Congress who vowed last week to pass measures that would lift the taxes, claiming that the Philippines is the only country imposing such fees on airlines.

Mr. Beltran, however, argued that “other countries may not have a common carriers’ tax or a gross Philippine billing tax specifically, but they have similar income and business taxes imposed on the foreign operations of our domestic airlines.”

Moreover, domestic carriers are also subject to 12% VAT and 30% corporate income tax here, atop of the taxes they pay to other countries, he pointed out.

The Finance department issued a position paper last week opposing calls to remove the gross Philippine billing tax and common carriers tax. claiming that foreign airlines already enjoy “considerably preferential” rates compared to those imposed on local airlines.

A sticking point for international carriers, though, is the zero-rated VAT enjoyed by domestic carriers, allowing them to claim back the sales tax they paid on their inputs.

Mr. Beltran explained that the government only granted this since the services of domestic carriers are considered exports.

“The same treatment cannot be extended to foreign airlines since we have no way of verifying their purchases,” he explained.

In response, an official of the European Chamber of Commerce of the Philippines (ECCP) accused the government of “comparing apples with oranges, and that successfully for many years.”

“The international carriers pay taxes on gross revenue whether they make money or not. The local carriers pay income tax when they make money,” ECCP Executive Vice-President Henry J. Schumacher said in a text message on Friday. Besides, all airline companies pay income taxes in their home countries, he pointed out.
“The common carriers’ tax is especially burdensome as the foreign airlines pay on gross, even for tickets not generated in the Philippines,” Mr. Schumacher said.

European carriers are particularly hard-hit by these taxes since they incur a lot of costs, traveling long distances between Europe and Asia, he added.

Other airlines are also in the same boat, Mr. Schumacher claimed, with US-based Delta Air Lines, Inc. already reducing its flights to the country, and Japanese carriers “looking at the return on their investments flying to the Philippines.”

Saturday, November 5, 2011

PAL Midnight Special

Are you traveling in the next six weeks? Check our domestic, regional and international Midnight Special deals by clicking the link below. Midnight Special starts 7pm tonight.
http://www.philippineairlines.com/special_offers/latest_offers/midnight_special.jsp

Friday, November 4, 2011

ECOP joins call for gov't action vs striking PAL workers

The Philippine Star
November 4, 2011

MANILA, Philippines - The Employers Confederation of the Philippines (ECOP) has joined the snowballing call for government action against violent abuses of outsourced employees of Philippine Airlines (PAL).

“It will be difficult for ECOP and all employers to ignore the continuing travesty of justice being committed by former PAL employees against PAL,” said ECOP president Edgardo Lacson in a statement.

While ECOP’s member-associations and employers recognize the rights of labor to air their grievances, “this right is not absolute and must be staged within the bounds prescribed by (the Labor Department’s) rules,” he said.

Pending resolution of a case filed by PALEA with the Court of Appeals, Lacson said “the union should observe the rule of law by allowing normal operations and not engaging in very disruptive picketing of PAL’s premises.”

Terminated PAL workers on Oct. 29 turned violent and blocked an exiting PAL truck from the PAL Inflight Center building using truncheons, wooden planks spiked with nails and even threatened to torch the truck, resulting in the hospitalization of a PAL security guard who suffocated from the fumes.

ECOP appealed for the lifting of the “illegal barricade immediately” for the sake of the “health, safety and well-being of the protesters.”

Earlier, the Federation of Philippine Industries (FPI), Federation of Filipino-Chinese Chambers of Commerce and Industry (FFCCCI) and Philippine Chamber of Commerce and Industry (PCCI) issued separate statements urging for swift and decisive government action in resolving the standoff between PAL and the separated workers.

The business groups said increasing number of incidents of harassment inflicted on PAL employees and equipment is “not conducive to business and could discourage investors.”

The FPI, FFCCCI and PCCI urged government to protect the rights of business in the same way that workers’ rights are protected by existing laws.

Last week, PAL called on the country’s business groups to collectively appeal for better protection of business against dismissed workers who prevent the free pursuit of their trade.

Gov't pushes PAL row resolution

Manila Bulletin
November 4, 2011
By Genalyn D. Kabiling and Bernie Cahiles

MANILA, Philippines — The government has pushed for the resolution of the labor row involving the Philippine Airlines within the law amid calls to be more quick and decisive like what Australia had done in the case of its troubled flag carrier, a Palace official said Thursday.

Deputy Presidential Spokeswoman Abigail Valte said the government exerted efforts to settle the conflict between PAL management and its workers while preventing potential clashes that may trigger anxiety among passengers and investors.

"We believe that we have settled the matter according to what the law dictates and according on the evidence that was presented before the Office of the President," Valte said.

Valte was referring to a Palace decision that upheld the outsourcing proposal of Philippine Airlines that displaced more 2,000 workers. Only a fraction of the workers accepted reassignment in the third party contractors while most employees continued their protest action.

"We have also likewise exerted efforts to make the two groups come to the table and come to an agreement," Valte added.

This developed as the management of PAL has also joined Labor Secretary Rosalinda Baldoz's call for a fair and impartial investigation of the incident at the PAL Inflight Center last October 29.

The airline also wants a thorough probe of baseless claims by its former employees that PAL allegedly instigated the tearing down of the protesters' tents and streamers outside the facility.

"The public deserves to know the truth. Only an honest-to-goodness impartial investigation would put an end to all speculation and malicious accusations being hurled against management by its former workers," PAL stressed.

Also, the Employers Confederation of the Philippines (ECOP) has called for government action on PAL case.

"It will be difficult for ECOP and all employers to ignore the continuing travesty of justice being committed by PALEA against PAL," said ECOP President Eduardo Lacson in a statement.

While ECOP's member-associations and employers recognize the rights of labor to air their grievances, "this right is not absolute and must be staged within the bounds prescribed by (the Labor Department's) rules," he said.

No one wants to buy PAL?

The Philippine Star
Demand and Supply
By Boo Chanco
November 4, 2011

It now seems that Lucio Tan will not be able to sell PAL to anyone any time soon. Not to a Filipino group anyway. Manny Pangilinan just said it would be awkward for him to buy PAL now that the Gokongweis of Cebu Pacific are his partners at PLDT. I had lunch with San Miguel’s Ramon S. Ang last week and he said, he can produce better results and faster in San Miguel’s other businesses with the billion dollars needed to rehabilitate PAL. (San Miguel is still waiting for government final approval for their unsolicited bid to build MRT-7 to Bulacan and a reaction from DOTC to their offer to rehabilitate PNR, extend it to Laoag and to Sorsogon at no cost to government.)

RSA told me he understands the problems of PAL, being a pilot himself who is familiar with aircraft operations. PAL’s aircrafts are either on lease or even those that the airline owns are beyond their service years or will soon be. An investor, he explained, can’t make money flying aircrafts that consume 30 percent more fuel than the latest models PAL’s competitors use. In so many words, RSA is virtually saying there is nothing to buy in PAL for an investor like him.

But RSA was once interested in acquiring PAL. He sent his investment bankers to do due diligence on the airline. That’s why he knows what financial resources are needed to make PAL really fly. Some of RSA’s aides told me he once told them PAL was a done deal but he changed his mind once the numbers came in. RSA said it would be better to start a new airline using the low cost carrier model than to try to rehab PAL, a legacy carrier.

RSA also told me that Philippine skies have now become extremely competitive. Even Cebu Pacific has started giving up margins and that has now affected their bottom line because of the cut throat pricing of AirPhil Express and Zest Air. Then there is Air Asia Philippines that is authorized to fly the Philippine domestic routes. Maybe, he surmised, it is not the time to start a new airline, much less buy a dinosaur airline like PAL.

Lucio Tan is apparently stuck in PAL in the foreseeable future. For as long as he is alive, he may feel the need to continually put money to finance its losing operations due to sheer ego considerations. His heirs may not be as disposed to throwing good money after bad.

International aviation is in a difficult situation too… witness the Qantas strike that was settled only after a court order was issued. And yes, Singapore Airlines just inaugurated another budget carrier a low cost long haul airline called Scoot. That’s in addition to Tiger Airways that Singapore Air already partly owns. Scoot will fly to China and Australia, countries PAL already flies to.

Thursday, November 3, 2011

End Pal row, big business groups tell govt

Business Mirror
November 3, 2011
By Max V. De Leon

BUSINESS groups are seeking government intervention to finally end the confrontations between Philippine Airlines (PAL) and its former employees as these could give investors the impression that the rights of businesses are not being properly protected here.

Federation of Philippine Industries (FPI) Chairman Jesus L. Arranza also urged the protesting dismissed employees of PAL to take the legal course and seek redress in a civil manner.

“If they have been dismissed, they still have the right to go to court. Let the law prevail. The government, on the other hand, should not hesitate in implementing the law. If this problem persists, it will certainly cause a setback to investments because law and order is important to businessmen,” Arranza said.

The government, he said, should make sure fairness is accorded to both business and labor.

The row between PAL and its former workers escalated recently. In one incident, a truck of PAL was blocked allegedly by some of the dismissed workers while leaving its In-Flight Center on MIA Road.

The picketing PAL employees, on the other hand, accused the management of the Philippine flag carrier of using goons to harass them.

The Federation of Filipino-Chinese Chambers of Commerce and Industry (FFCCCI) also appealed to law-enforcement agencies to prevent potential clashes between PAL and its former employees.

It said the conflict is triggering anxiety among local and foreign investors.

“We’re requesting authorities to take a more direct hand in resolving the impasse before things get out of control. The recent turn of events where former PAL workers resorted to harassment and intimidation tactics at their picket line, impeded the airline’s operations,” FFCCCI President Tan Ching said.

The group said businesses recognize the right of workers to air their grievances, and hopes the employees are aware that employers have their rights also.

The FFCCCI said it wishes the problem would be resolved soon like what the Australian government had done in the case of its flag carrier Qantas Airlines, which grounded its flights worldwide just on Saturday but whose planes returned to the skies after just two days.
“A quick resolution of the dispute at PAL would certainly be more conducive to the country’s business climate,” Ching said.

PAL has called on business groups to collectively appeal for better protection of businesses, noting that “it is in the best interest of all private businesses, big or small, to protect themselves against harassments like illegal blockades by former workers who have been validly and legally dismissed.”

Meanwhile, Labor Secretary Rosalinda Baldoz on Wednesday ordered an inquiry into the alleged attack by hired goons at the picket line of striking members of the Philippine Airlines Employees Association (Palea).

A team from the Department of Labor and Employment (DOLE) is now investigating the incident that occured on the early morning of October 29 which reportedly caused injury to seven Palea members and unconfirmed death of a security guard who was suffocated by tear gas, Baldoz said in a statement on Wednesday.

The DOLE monitoring team dispatched to the area is also coordinating with with the aviation police handling the case.

The labor chief stressed that “the attack is uncalled for,” as she called on members of the Philippine

National Police to exercise maximum tolerance in dealing with the protesting union members.
“We also reiterate our earlier call for sobriety on the part of PAL management and the Palea,” Baldoz said.
“We also call for the conduct of a swift and fair investigation to determine the truth behind this unfortunate incident.”

Big business groups rally behind PAL

The Philippine Star
November 3, 2011

MANILA, Philippines - Some of the country’s biggest business groups yesterday expressed solidarity with Philippine Airlines (PAL) as they joined calls for swifter and more decisive government action to resolve the standoff between the embattled flag carrier and its separated workers.

Federation of Philippine Industries Inc. (FPI) chairman Jesus Arranza said the current problems plaguing PAL, particularly the recent blocking of one of its trucks by dismissed workers, “is not conducive to business,” as this could discourage investors.

He urged government, particularly the Department of Labor and Employment (DOLE) to ensure that the rights of businesses are protected in the same way as it accords protection to workers.

“We’re only asking for fair play. Government shouldn’t allow ‘tyranny of the minority’ which is currently happening at PAL. As Mayor Lim once said, ‘the law should be applied to all, or not at all,” he stressed.

For his part, PCCI president Francis Chua said his group wants an immediate resolution of the dispute between PAL and its former workers, citing that industrial peace is key to success in any business.

“PCCI is definitely supporting business and industry, but we must also look at the interest of the labor sector. Labor is an indispensable element in wealth formation,” he said.

Meanwhile, the FFCCCI appealed to law enforcement agencies to exert all efforts to prevent potential clashes between PAL and its former employees as the conflict is triggering anxiety among local and foreign investors.

“We’re requesting authorities to take a more direct hand in resolving the impasse before things get out of control. The recent turn of events where former PAL workers resorted to harassment and intimidation tactics at their picket line, impeded the airline’s operations,” said FFCCCI president Tan Ching.


The group said businesses recognize workers’ right to air their grievances, but said it hopes employees are also aware that employers have rights, too. The FFCCCI said it wishes the problem would be resolved soon like what the Australian government had done in the case of its flag carrier Qantas Airlines.

“A quick resolution of the dispute at PAL would certainly be more conducive to the country’s business climate,” he added.

Earlier, PAL called on business groups to collectively appeal for better protection of businesses which are prevented from freely pursuing their trade.

PAL said it is in the best interest of all private businesses, big or small, to protect themselves against harassment like illegal blockades by former workers who have been validly and legally dismissed.

Business groups seek end to standoff between PAL, workers

Philippine Daily Inquirer
November 3, 2011
By: Daxim L. Lucas

Various business groups on Wednesday offered their support to beleaguered Philippine Airlines after it appealed to industry allies to help it fend off what it called “harassment” by dismissed workers and their allies.
In separate statements, heads of the Philippine Chamber of Commerce and Industry (PCCI), the Employers Confederation of the Philippines (Ecop), the Federation of Filipino-Chinese Chambers of Commerce and Industry (FFCCCI) and the Federation of Philippine Industries (FPI) appealed to the government to help end the standoff between the flag carrier and its critics.

“It will be difficult for Ecop and all employers to ignore the continuing travesty of justice being committed by (former employees) against PAL,” Ecop president Ed Lacson said.

Lacson said there was already a case pending before the Court of Appeals filed by the Philippine Airlines Employees Association (Palea) and that the union should observe the rule of law by allowing normal operations and refrain from disrupting the airline’s operations.

“Ecop recognizes the right of labor movements to strike as a tool to air grievances against management,” Lacson said. “But this right is not absolute and must be staged within the bounds prescribed by DoLE’s [Department of Labor and Employment] rules.”

PCCI president Francis Chua said his organization—the country’s largest with some 20,000 members—was backing the legitimate grievances of the business sector and industry like the need to be protected against the disruptive actions of laid-off employees or their allies from militant labor groups.

“We also look at the interest of the labor sector,” Chua said, appealing for sobriety between both sides. “Labor is the element in wealth formation. Industrial peace is the key to success in any business venture.”
The FFCCCI—the umbrella organization of Filipino-Chinese businesses in the country—also urged the government to act swiftly on the standoff between PAL and its former employees.

“We are requesting authorities to take a more direct hand in resolving the impasse before things get out of control,” FFCCCI president Tan Ching said in a statement. “The recent turn of events where former PAL workers resorted to harassment and intimidation tactics at their picket line impeded the airline’s operations.”
The group said businesses recognize workers’ right to air their grievances, but said it hopes employees are also aware that employers have rights, too.

Big biz groups back PAL

MANILA, Philippines — Some of the country’s biggest business groups Wednesday expressed solidarity with Philippine Airlines (PAL) as they joined calls for swifter and more decisive government action to resolve the standoff between the embattled flag carrier and its separated workers.

Federation of Philippine Industries, Inc. (FPI) chairman Jesus Arranza said the current problems plaguing PAL, particularly the recent blocking of one of its trucks by dismissed workers, “is not conducive to business”, as this could discourage investors.

He urged government, particularly the Department of Labor and Employment (DoLE) to ensure that the rights of businesses are protected in the same way as it accords protection to workers.

“We’re only asking for fair play. Government shouldn’t allow ‘tyranny of the minority’ which is currently happening at PAL. As Mayor Lim once said, ‘the law should be applied to all, or not at all,” he stressed.

For his part, PCCI president Francis Chua said his group wants an immediate resolution of the dispute between PAL and its former workers, citing that industrial peace is key to success in any business.

Meanwhile, the FFCCCI appealed to law enforcement agencies to exert all efforts to prevent potential clashes between PAL and its former employees as the conflict is triggering anxiety among local and foreign investors.

"We’re requesting authorities to take a more direct hand in resolving the impasse before things get out of control. The recent turn of events where former PAL workers resorted to harassment and intimidation tactics at their picket line, impeded the airline’s operations," said FFCCCI president Tan Ching.

Business groups urge government to enforce law on PAL premises

Manila Bulletin
November 3, 2011
By Bernie Cahiles-Magkilat

MANILA, Philippines — Business groups have called on government to enforce the rule of law fairly to everyone as they rally behind the beleaguered Philippine Airlines where former employees have camped out in its premises in Pasay City blocking and disrupting their day to day operations.

In a statement, the Philippine Chamber of Commerce and Industry, the Federation of Philippine Industries and the Federation of Filipino-Chinese Chamber of Commerce and Industry have expressed the same sentiments that government should equally enforce the rule of law to all.

PCCI president Francis Chua said his group wants an immediate resolution of the dispute between PAL and its former workers, citing that industrial peace is key to success in any business.

“PCCI is definitely supporting business and industry, but we must also look at the interest of the labor sector. Labor is an indispensable element in wealth formation,” he said.

FPI president Jesus Arranza said that PAL is not the only company which had been harassed by former employees citing first hand experiences.

“Definitely, we are supporting PAL and we support the rule of law as Mayor Lim said ‘the law should be applied to all or not at all’,” Arranza said.

In particular, Arranza has called on the Department of Labor and Employment to act on the PAL situation swiftly.

“DoLE should take action in the same way that we have to protect employees,” he said noting that some labor arbiters normally have soft side for the labor sector.

What is happening now in PAL, Arranza said is a “tyranny of the minority.”

“We are asking only for fair play because because there are bad and good employees in the same way that not all employers are good,” he said.

He further said that what is happening now in PAL is not conducive to business, even local investors will be discouraged.

For its part, the FFCCCI appealed to government, particularly concerned law enforcement agencies, to act swiftly on the standoff between Philippine Airlines (PAL) and its former employees as the conflict is triggering anxiety among local and foreign investors.

"We are requesting authorities to take a more direct hand in resolving the impasse before things get out of control. The recent turn of events where former PAL workers resorted to harassment and intimidation tactics at their picket line, impeded the airline’s operations," said FFCCCI president Tan Ching.

The group said businesses recognize workers’ right to air their grievances, but said it hopes employees are also aware that employers have rights, too. The FFCCCI said it wishes the problem would be resolved soon like what the Australian government had done in the case of its flag carrier Qantas Airlines.

"A quick resolution of the dispute at PAL would certainly be more conducive to the country’s business climate," he added.

The business groups issued this appeal after flag carrier Philippine Airlines (PAL) sought their help to press government for quicker and more decisive response against harassment of private enterprises.

In a statement, PAL said it is calling on business groups like the Philippine Chamber of Commerce and Industry, Inc. (PCCI), Management Association of the Philippines (MAP), Federation of Philippine Industries (FPI), Employers Confederation of the Philippines (ECOP), the Federation of Filipino-Chinese Chambers of Commerce and Industry, Inc. (FFCCCI) and others to collectively appeal for better protection of businesses which are prevented from freely pursuing their trade.

PAL said it is in the best interest of all private businesses, big or small, to protect themselves against harassment like illegal blockades by former workers who have been validly and legally dismissed.

“The recent incident where PAL’s catering truck was blocked by protesting former workers armed with truncheons and planks with nails is one clear example of this kind of harassment seemingly tolerated by police authorities,” the airline stressed.

PAL expressed frustration that it has complained and sought the help of almost all relevant government agencies “to no avail”. Todate, it said the airline continues to suffer since its service providers and cabin crew are unable to use PAL’s facility along MIA Road, Pasay City where laid off workers have set up camp.

“Continuing police inaction against all forms of harassment perpetrated by dismissed workers only served to embolden these illegal occupants of PAL’s property,” it stressed.

Wednesday, November 2, 2011

PAL seeks help of allies

Manila Bulletin
November 2, 2011

FLAG carrier Philippine Airlines (PAL) yesterday said it would seek help from the country’s leading business organizations to press government for quicker and more decisive response against harassment of private enterprises.

In a statement, PAL said it is calling on business groups like the Philippine Chamber of Commerce and Industry, Inc. (PCCI), Management Association of the Philippines (MAP), Federation of Philippine Industries (FPI), Employers Confederation of the Philippines (ECOP), the Federation of Filipino-Chinese Chambers of Commerce and Industry, Inc. (FFCCCI) and others to collectively appeal for better protection of businesses which are prevented from freely pursuing their trade.

PAL said it is in the best interest of all private businesses, big or small, to protect themselves against harassment like illegal blockades by former workers who have been validly and legally dismissed.

“The recent incident where PAL’s catering truck was blocked by protesting former workers armed with truncheons and planks with nails is one clear example of this kind of harassment seemingly tolerated by police authorities,” the airline stressed.

PAL expressed frustration that it has complained and sought the help of almost all relevant government agencies “to no avail”. Todate, it said the airline continues to suffer since its service providers and cabin crew are unable to use PAL’s facility along MIA Road, Pasay City where laid off workers have set up camp.

“Continuing police inaction against all forms of harassment perpetrated by dismissed workers only served to embolden these illegal occupants of PAL’s property,” it stressed.

Worse, the airline said it is now even on the receiving end of baseless and malicious accusations by these workers that it engaged outside elements to disperse their camp.

Leftist sectoral representatives have also been directly accusing PAL of harassing former workers while turning a blind eye on their documented transgressions. PAL added that it is being threatened with another congressional probe with no clear legislative intent and with only the plain objective of embarrassing PAL resource persons in attendance.

Exasperated, Philippine Airlines fights back

Philippine Daily Inquirer
November 2, 2011
By Daxim L. Lucas

Reeling from its dispute with former employees and their supporters, flag carrier Philippine Airlines (PAL) on Tuesday appealed to the country’s business organizations for help in pressing the government to come up with a quicker and more decisive response to the harassment of private enterprises.

In a statement, PAL called on groups such as the Philippine Chamber of Commerce and Industry Inc., Management Association of the Philippines, Federation of Philippine Industries, Employers Confederation of the Philippines, and Federation of Filipino-Chinese Chambers of Commerce and Industry Inc., among others, “to collectively appeal for better protection of businesses which are prevented from freely pursuing their trade.”

Blocked

PAL pointed out that it was in the best interest of private firms to protect themselves from “harassment,” particularly by former workers who put up blockades and otherwise disrupt operations.

“The recent incident where a PAL catering truck was blocked by protesting former workers armed with truncheons and planks with nails is one clear example of this kind of harassment seemingly tolerated by police authorities,” the airline’s management said.

The airline expressed frustration its complaints and appeals for help from government agencies were “to no avail.”

It said its cabin crews and service providers were unable to use the PAL facility on MIA Road in Pasay City in front of which the former workers had set up a protest camp.

What goons?

“Continuing police inaction against all forms of harassment perpetrated by dismissed workers only serves to embolden these illegal occupants of PAL’s property,” the airline said.

Aggravating the issue, said PAL, was that it was now on the receiving end of “baseless and malicious accusations” by the former employees that it had hired goons to disperse their camp.

One bystander died of a heart attack and eight ex-workers were injured during the melee that ensued when about 50 men overran the camp.

PAL scores detractors for ‘wild’ accusations

Business Mirror
November 2, 2011

PHILIPPINE Airlines on Tuesday lashed out against its detractors for hastily laying the blame on the airline management for Saturday’s confrontation at the PAL Inflight Center (IFC) in Pasay City.
In a statement, PAL said those who know nothing better than make wild and baseless accusations against the airline should shut up and let the police do the investigative work.

The airline said it was grossly irresponsible for some left-leaning sectoral representatives to accuse PAL management of harassing laid-off workers.

“It was clear from news reports and photographs taken from the scene that former PAL workers barred the airline’s catering truck from leaving its own facility. They were armed with rattan truncheons, planks with nails and even burned a carton box, all with the aim of inflicting harm should the truck driver insist on leaving PAL’s Inflight Center. So who’s harassing who?” PAL asked.

PAL said it was also lamentable that police authorities “were nowhere to be found” when its truck was being blocked by protesters, but conveniently “arrested” someone who claims to have been hired by PAL management to “disperse” its former employees’ camp.

“Worse, authorities were reportedly unable to apprehend those responsible for the death of a hapless bystander,” PAL said.

As to the stench allegedly emanating from its Inflight Center, PAL said protesting former PAL workers have only themselves to blame. “They won’t allow our trucks to leave the facility; even a garbage truck from Pasay City’s waste management office was prevented by protesters from picking up garbage unless these were brought to the IFC gate. And now they complain that the area stinks? Let them have a dose of their own medicine,” PAL stressed.

On PAL’s alleged refusal to provide protesting former workers with free tickets, it said: “PAL reserves the right to refuse conveyance to those who make false and malicious claims that the airline is unsafe and whose ultimate goal is to bring down the company.”

Meanwhile, PAL staff members based in the airline’s North America regional office in San Francisco denounced the picket staged on October 27 by American unionists in the Bay Area in support of dismissed PAL workers in Manila.

The San Francisco-based PAL union members expressed collective support to the airline’s efforts at normalizing operations after implementation of its outsourcing program on October 1.

In a signed manifesto, 10 US-based PAL unionists rejected calls to join the October 27 picket held in front of the Philippine Consulate led by members of the Burlingame, California-based International Association of Machinists & Aerospace Workers.

(Recto Mercene)

PAL seeks allies to fight ‘harassment’

The Philippine Star
November 2, 2011

FLAG carrier Philippine Airlines (PAL) yesterday said it would seek help from the country’s leading business organizations to press government for quicker and more decisive response against harassment of private enterprises.

In a statement, PAL said it is calling on business groups like the Philippine Chamber of Commerce and Industry, Inc. (PCCI), Management Association of the Philippines (MAP), Federation of Philippine Industries (FPI), Employers Confederation of the Philippines (ECOP), the Federation of Filipino-Chinese Chambers of Commerce and Industry, Inc. (FFCCCI) and others to collectively appeal for better protection of businesses which are prevented from freely pursuing their trade.

PAL said it is in the best interest of all private businesses, big or small, to protect themselves against harassment like illegal blockades by former workers who have been validly and legally dismissed.

“The recent incident where PAL’s catering truck was blocked by protesting former workers armed with truncheons and planks with nails is one clear example of this kind of harassment seemingly tolerated by police authorities,” the airline stressed.

PAL expressed frustration that it has complained and sought the help of almost all relevant government agencies “to no avail”. Todate, it said the airline continues to suffer since its service providers and cabin crew are unable to use PAL’s facility along MIA Road, Pasay City where laid off workers have set up camp.

“Continuing police inaction against all forms of harassment perpetrated by dismissed workers only served to embolden these illegal occupants of PAL’s property,” it stressed.

Worse, the airline said it is now even on the receiving end of baseless and malicious accusations by these workers that it engaged outside elements to disperse their camp.

Leftist sectoral representatives have also been directly accusing PAL of harassing former workers while turning a blind eye on their documented transgressions.

Tuesday, November 1, 2011

PAL asks detractors to stop wild, baseless accusations

The Philippine Star
November 1, 2011
By Aurea Calica

MANILA, Philippines - Philippine Airlines (PAL) yesterday lashed out at its detractors for hastily laying the blame on airline management for Saturday’s confrontation at the PAL Inflight Center in Pasay City.

In a statement, PAL said those who know nothing better than to make wild and baseless accusations against the airline should shut up and let the police do the investigative work.

The airline said it was grossly irresponsible for some left-leaning sectoral representatives to accuse PAL management of harassing laid off workers.

“It was clear from news reports and photos taken from the scene that former PAL workers barred the airline’s catering truck from leaving its own facility. They were armed with rattan truncheons, planks with nails and even burned a carton box, all with the aim of inflicting harm should the truck driver insist on leaving PAL’s Inflight Center. So who’s harassing who?” PAL asked.

PAL said it was also lamentable that police authorities “were nowhere to be found” when its truck was being blocked by protesters, but conveniently “arrested” someone who claims to have been hired by PAL management to “disperse” its former employees’ camp.

“Worse, authorities were reportedly unable to apprehend those responsible for the death of a hapless bystander,” PAL said.

As to the stench allegedly emanating from its Inflight Center, PAL said protesting former PAL workers have only themselves to blame. “They won’t allow our trucks to leave the facility, even a garbage truck from Pasay City’s waste management office was prevented by protesters from picking up garbage unless these were brought to the IFC gate. And now they complain that the area stinks? Let them have a dose of their own medicine,” PAL stressed.

On PAL’s alleged refusal to provide protesting former workers with free tickets, it said: “PAL reserves the right to refuse conveyance to those who make false and malicious claims that the airline is unsafe and whose ultimate goal is to bring down the company.”



PAL staff based in the airline’s North America regional office in San Francisco denounced the picket staged last Oct. 27 by American unionists in the Bay Area in support of dismissed PAL workers in Manila.

The San Francisco-based PAL union members expressed collective support to the airline’s efforts at normalizing operations after implementation of its outsourcing program last Oct. 1.

In a signed manifesto, 10 US-based PAL unionists rejected calls to join the Oct. 27 picket held in front of the Philippine Consulate led by members of the Burlingame, California-based International Association of Machinists & Aerospace Workers.

“We do not approve of such demonstration and refuse to participate. In these hard and difficult economic times, let us not aggravate the situation with noisy and disruptive demonstrations,” said the group in reply to a letter-invitation by union steward Danilo Mirabucao.

The letter was signed by the following PAL union members: Jennifer del Rosario, Maria Josephine Encarnacion, Editha Gelasio, Teresa Jante, Carmencita Macante, Shirley Ong, Edwin Perez, Emilyn Roxas-Liwag, Rosita Tobes and Theresa Jasmin Houwer of the San Francisco station.

‘Casualty not  involved in row’

Meanwhile, MalacaƱang maintained yesterday that the lone casualty who was caught in the clash between protesting dismissed workers from the Philippine Airlines Employees Association (PALEA) was not involved in the labor row affecting the flag-carrier.

“They (authorities) were able to determine that the lone casualty  (had nothing to do with the labor issue). Unfortunately, he was just caught in the middle of the riot because he was near, but he was not part of the picket line,” clarified deputy presidential spokesperson Abigail Valte.

Valte was referring to Arvin Macalalad who died of cardiac arrest when he was caught in the middle of the PALEA strike and that of a still unidentified group who attacked the picket line over the weekend in Pasay City.

She nevertheless said that the incident is already being investigated by the Department of Labor and Employment under Secretary Rosalinda Baldoz, and developments on the situation are being monitored.

PALEA employees had been separated from the flag-carrier since Oct. 1, in line with an outsourcing program that no less than President Aquino has approved. PALEA has questioned the legality of PAL’s outsourcing in the courts.

The Palace official said they understand the concerns of both parties, and have called on them to “exercise sobriety in their dealings with each other” so that similar incidents would not happen again.

Valte said they did not know when the standoff would end, citing the pending legal issues that have been raised, but that as far as the Office of the President is concerned, Aquino has already made a decision upholding PAL’s outsourcing program.

Aquino stood pat on his decision, even if it meant more PAL employees would be displaced and dismissed as a result of the outsourcing program, noting that “the airline is in distress, they need a reformatting of their corporation to survive.”

“We would like to sympathize with those in PALEA who were going to get into their collective bargaining agreement. But the interests of the 10 million OFWs far outweigh the thousands or the 2,000 or so that were affected by PALEA,” he pointed out.

“There is no perfect solution to this mess but it is part and parcel of the changing realities with the economic situation in the entire world,” he told foreign journalists in a forum last month.

“What is the national interest? If you define the national interest, there are 10 million Filipinos overseas. With what has been happening in the Middle East, one would want airlines capable of going to the Middle East to fetch our citizens,” Aquino stressed.

“We could not allow the national flag carrier and the only other airline capable of reaching those destinations to become non-entities and lose that ability to do it, if there was a need to repatriate our countrymen,” he explained.