Tigerair sells 40% stake in Philippine unit to Cebu Pacific

Singapore budget carrier Tigerair is divesting its 40 per cent interest in loss-making Tigerair Philippines to Cebu Pacific for US$7 million (S$8.9 million).

In a filing with the Singapore Exchange on Wednesday, a joint statement by both the carriers said this is part of their plans for a wide-ranging strategic alliance.

Tigerair and Cebu Pacific intend to collaborate commercially and operationally on international and domestic air routes from the Philippines, thereby creating the biggest network of flights to the region.

Subject to regulatory approval, the two partners will jointly operate common routes between Singapore and the Philippines.

By combining resources, Cebu Pacific will be able to provide services to high growth markets including Australia and India.

Tigerair will be able to fly more passengers to additional cities in Cebu Pacific's network in the Philippines and North Asia. This arrangement will allow both airlines to deploy capital more efficiently.

Following the acquisition of the 40 per cent stake in Tigerair Philippines, Cebu Pacific will have full ownership of the airline.

SOURCE

European Union lifts safety ban on Philippine Airlines

The European Union has lifted a three-year ban on Philippine Airlines flying into its airspace after the national carrier addressed safety concerns, the EU's ambassador to Manila said on Wednesday.

PAL will be allowed to fly into the 28-member bloc from Friday, which will spur tourism and business links, ambassador Guy Ledoux said.

"This is a tremendous achievement in such a short period of time," Ledoux said.

He added that the EU would conduct further reviews so other Philippine carriers would also be able to fly to Europe as well.

"This decision is very encouraging and is the first success of CAAP (Civil Aviation Authority of the Philippines) and Philippine Airlines," he told reporters.

"EU-Philippines trade and investment relations will benefit from the lifting of the air ban," Ledoux added.

He remarked that even without direct flights, European tourist arrivals to the Philippines rose by about 10 percent last year to 349,000 and expressed hope that the lifting of the ban would boost this even further.

CAAP director-general William Hotchkiss said raising safety standards had required "superhuman effort" including recruiting veteran talent.

He also expressed confidence that by the end of the year, the US Federal Aviation Administration would lift a similar ban that restricts Philippine carriers from expanding operations to the United States.

PAL president Ramong Ang told reporters at a joint press conference with Ledoux that the carrier planned to begin flights to London, Paris, Rome and Amsterdam by September or October.

He said PAL could compete with lower-cost Mideast airlines in serving those routes because it would offer non-stop flights.

PAL is already entitled to seven flights a week to London and at least six flights a week to Paris, Ang said.

He said the airline would enter into negotiations for the other destinations.

Ledoux said the safety ban on other Philippine carriers may also be lifted amid a general improvement in the country's aviation standards and positive work by the CAAP.

However he said that the EU ban on Cebu Pacific, a second major Philippine carrier, had been maintained because of an incident last month where a Cebu Pacific plane skidded off a runway while landing in the southern Philippine city of Davao.

He said this "unfortunate recent accident in June... shows some weaknesses need to be addressed."

None of the 165 people aboard the plane were hurt but CAAP later suspended the two pilots involved and harshly criticised Cebu Pacific for safety lapses.

Ledoux said the European Commission was encouraged by the actions being taken by CAAP and Philippines air carriers to address outstanding safety issues and would continue to monitor the situation closely.

Cebu Pacific said in a statement that it hoped to take part in the next EU air safety commission meeting later this year and continues to look at opening services to "parts of Europe and the US".

The EU announced in March 2010 that it had banned all Philippine airlines from flying into Europe for "serious and persistent non-compliance" with the bloc's air safety rules.

The US issued its ban on the Philippines expanding its operations in 2008.

SOURCE

This is good news for PAL. They're now able to extend their network into EU airspace. However, the ban continues for Cebu Pacific after they failed to react adequately to a crash weeks ago.

Philippine pilots slammed over runway accident

Philippine aviation authorities on Tuesday suspended two pilots from budget carrier Cebu Pacific after their plane overshot a runway, saying they should have aborted the landing and failed to evacuate the aircraft which could have exploded.

The plane skidded off the runway in bad weather on June 2, coming to a halt on muddy ground beside the tarmac at the airport in the southern city of Davao.

All 165 people on board escaped unharmed, but angry passengers have criticised the pilots and crew, saying they were given no assistance despite the turmoil inside the plane after the terrifying landing.

Releasing the results of an initial investigation, the Civil Aviation Authority of the Philippines (CAAP) criticised the two pilots for a series of lapses.

The authority's deputy director John Andrews said they should have aborted the landing when they realised the plane was not coming down at the correct angle.

And once the plane was on the ground, the pilots failed to immediately evacuate the passengers, leaving them on board for 15 minutes during which time the aircraft could have erupted in flames.

"In cases like this, you immediately initiate emergency evacuation. You don't know if the plane will explode or if the fuel lines were cut and there will be a fire," Andrews told reporters.

The chief pilot was suspended for six months and barred from serving as captain on a plane for a year, while his co-pilot was suspended for three months.

Cebu Pacific will also be asked to comply with an "action plan" which stresses safety over cost-cutting, Andrews said, adding that shaving down turnaround time between flights could cause mistakes to happen.

"When you speed things up, you sometimes forget something," he said. "We can say Cebu Pacific is safe. We just want to make it more safe."

CAAP officials said the airline could still face additional fines for the damage and losses caused to the airport.

Cebu Pacific said in a statement that it would comply with all the aviation authority's recommendations and would improve its training procedures, putting a new emphasis on safety.

The airline began commercial operations in 1996, attracting customers by offering cut-rate fares to local destinations.

It has expanded operations in recent years, now flying to many major Asian cities. Cebu Pacific boasts that it carries more passengers than any other airline in the Philippines.

SOURCE

This is very poor safety practice from the crew in the airplane, putting all lives at risk with their incompetence. It is no wonder both pilots are suspended with the captain receiving a heavier punishment for his lack of situational awareness. Was training provided by the airline sufficient to handle such situations? If yes, why did the pilots do nothing? If no, then safety concerns are a very big suspect in the airline.

Cebu Pacific probed for rough landing

Philippine aviation authorities are investigating the rough landing of a Cebu Pacific aircraft after passengers were forced to wait some 15 minutes to get off the disabled aircraft.

The Airbus A320-200 overshot the runway on Sunday in stormy weather and landed on its nose. Davao International Airport remains closed because of the stuck plane.

Civil Aviation Authority Deputy General John Andrews said today (June 4) that the pilots’ error probably caused the accident. None of the 165 passengers was injured, but several complained about the slow response.

Davao Mayor Sara Duterte said that the airport delayed alerting city emergency services and denied quick access to the passengers.

Cebu Pacific President Lance Gokongwei has apologised but defended the crew.

SOURCE

It's a good thing there is no casualty involved in this incident, that is the most crucial factor.

AirAsia's Philippine unit buys into rival

The Philippine unit of regional budget airline leader AirAsia announced on Monday it had acquired 49 percent of local carrier Zest Airways, allowing it to fly out of the nation's capital.

The deal will also see Zest Airways' owner, tycoon Alfredo Yao, take 15-percent stake of Philippines' AirAsia, a company statement said.

The alliance will allow Philippines' AirAsia, which has operated from an airport 90 minutes' drive north of Manila since launching in 2011, to fly out of the capital's main international airport.

"This will allow us to leverage on our respective strengths, which in the case of Zest Air, include its operations out of (Manila)," Philippines' AirAsia chief executive officer Marianne Hontiveros said in the statement.

Philippines' AirAsia chairman Antonio Cojuangco said the partnership would lift both companies, citing "the Philippines aviation market('s) tremendous upside potential".

The Philippines has recently seen a boom in air traffic with its largest airlines, local budget pioneer Cebu Pacific and flag-carrier Philippine Airlines implementing multi-billion-dollar fleet expansions.

The government is aiming for tourist arrivals to increase from 4.2 million last year to 10 million in 2016.

The two airlines will continue separate operations for now, but will be able to share facilities and resources, Philippines' AirAsia spokeswoman Genefer Bugarin-Tan said.

She would not disclose how much the deal had cost.

Philippines' AirAsia is 40 percent owned by Malaysia's AirAsia Berhad, the region's biggest budget carrier in terms of fleet size, while the balance is owned by prominent Filipino business leaders.

It currently flies from its base north of Manila to Singapore, Hong Kong, Taipei and Kuala Lumpur, as well as two popular local tourist destinations.

Zest Air operates from Manila and the central city of Cebu. It flies to 14 cities in the Philippines as well as 10 international destinations, including cities in South Korea, China, Taiwan and Malaysia.

SOURCE

A big move by AirAsia to swallow more market share in the Filipino market and they should rightly do so. Massive air traffic is predicted coming out of this country as its affluence rises and more investors pour into the country.