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8 April 2010

Philippine national airlines resume Mid-East flights

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Philippine Airlines’ return to the Middle East has been successful so far, with flights posting profitable occupancy rates more than a week after the service to Riyadh was revived, the Philippine Daily Inquirer reported, quoting officials.

PAL corporate communications head Jonathan Gesmundo said that since PAL started flying back to Riyadh late last month, flights from Manila have been packed.

The Lucio Tan-led airline started flying back to the Saudi Arabian capital four times weekly last March 28 using the company’s 433-seater Boeing 747 jet.

“The four weekly flights might not be able to cope with the demand for the flights,” Gesmundo said in an interview.

While he declined to disclose the Riyadh flights’ average load factor, or the number of passengers on each plane relative to the number of available seats, Gesmundo said the take-up has been “very encouraging.”

“The numbers are very good. In fact, the report is that forward bookings for flights to Riyadh have been consistently high,” he said. “The flights have been very profitable,” he said.

PAL last served Riyadh in 2006 as the company struggled to compete with Middle Eastern carriers which got their fuel at a discount from their governments.

The decision to leave the otherwise lucrative market also came as the company worked on returning to profitability and exiting corporate rehabilitation.

A concern for PAL, however, is the apparent imbalance in demand between flights to Riyadh from Manila and flights to Manila from Riyadh.

Gesmundo said there were less people going back to the Philippines as there were going out. He said this was because most Filipinos working in Riyadh were only given paid vacations every two to three years.

He said PAL also needed to monitor the price of tickets offered by competing state-owned Middle Eastern carriers. He said these airlines had in previous years brought their prices back to levels that PAL could compete with.

“We’ll have to see if they start to bring back their cut-throat pricing,” Gesmundo said.


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