CAPA labels PR flight to EU too risky
19 July 2013
Philippine Airlines (PAL) Chief Operating Officer and President Ramon Ang has different perception in mind saying that they have studied the European market more than once for so long that they are certain to be competitive in the Europe-Asia market. Its market study also found that daily flights to major European destinations gets better results than having to fly on odd-even days.
Ang said that PAL's ticket prices will be "very competitive" with other airlines, which offer economy seats from Manila to London at $1,200 or about P52,000.
PAL is targeting close to 1 million migrant workers in Europe as well as leisure travellers heading to the Philippines. But CAPA maintains that Gulf carriers are in better position to carry European tourist to the country given their much larger European networks.
19 July 2013
After 15 year hiatus, Philippine Airlines (PAL) will be back in Europe with ever increasing and tense competition to the region amidst recession in the EU area. Can PAL survives the competition?
The Centre for Asia Pacific Aviation (CAPA) thinks otherwise and labelled the airlines desire to fly to Europe as "overly ambitious".
In its analysis, it found that its better for PAL to focus its attention "on the better performing Asia-Pacific market" which CAPA said is generally a more profitable option, considering the present economic environment.
"A large online network could help and quickly build PAL’s brand in the European market, where the carrier is relatively unknown. But operating several 12 to 13-hour routes in a market that is highly price sensitive and has limited premium demand is very risky", it said.
CAPA added that "Such long-range flights are expensive to operate and PAL could struggle to achieve the yields necessary to make the routes viable, particularly as it will need to price competitively against more economical one-stop products".
Philippine Airlines (PAL) Chief Operating Officer and President Ramon Ang has different perception in mind saying that they have studied the European market more than once for so long that they are certain to be competitive in the Europe-Asia market. Its market study also found that daily flights to major European destinations gets better results than having to fly on odd-even days.
Ang said that PAL's ticket prices will be "very competitive" with other airlines, which offer economy seats from Manila to London at $1,200 or about P52,000.
PAL is targeting close to 1 million migrant workers in Europe as well as leisure travellers heading to the Philippines. But CAPA maintains that Gulf carriers are in better position to carry European tourist to the country given their much larger European networks.
