Philippines Airlines Hit Hard By Coronavirus

Philippines Airlines has announced plans to cut over 30% of its workforce, amounting to up to 2,000 employees. (Photo: AirlineGeeks | William Derrickson)

[ News ]September 9, 2020 5:00 am ET

By Will Lee

Philippines Airlines is reeling from COVID-19 pandemic and is set to slash its workforce by 35% in October. Staff at Philippines Airlines Express, the subsidiary of Philippines Airlines, are also affected, according to Phil Star Global. With no end in sight for the pandemic, the airline expects the travel demand to remain extremely low.

The Manila-based airline has 6,000 staff. In the first half of 2020, the airline recorded the loss of P20 billion ($411.9 million) as ticket sales dropped nearly 35% to P36.82 billion. The airline posted a loss of P3.3 billion during the same time last year.

In response to the pandemic, the airline has implemented cost-cutting measures. In March, the flag carrier cut its manpower by 300 employees, ranging from ground staff to executives. Up to 2,000 people could be impacted by the airline’s next round of cuts. The airline will process voluntary separations first and then cut the required extra staffing to remain viable.

In addition, new aircraft expected to be delivered in 2020 and 2021 will be pushed back to 2022 to 2025. According to Inquirer, Philippines Airlines’ owner has pumped P6.27 billion into the airline this year thus far and P17.68 billion since 2019. In the meantime, the airline is waiting for an economic lifeline from the government.

Japan’s All Nippon Airways teamed up with Philippines Airlines and acquired a 9.5% stake in the airline for $95 million last year. In 2019, PAL’s network reaches 80 destinations in four continents, allowing both networks to benefit each other and serve passengers better.

During the pandemic, the Philippines Airline has deployed the crucial flights to serve stranded Filipinos living abroad and provided cargo services to transport essential goods such as food, medicines and personal protective gear. Philippines Airlines currently provides limited services to New York, Los Angeles, San Francisco, London and Hong Kong as well as some domestic services.

Philippines Airlines has been named one of the safest airlines for travel during the pandemic. In response to the honor, the airline’s President and Chief Operating Officer, Gilbert Santa Maria, said, “We are grateful for the unexpected recognition, and honored to be recognized for doing the right thing. PAL shall continue to maintain the highest standards of safety and the protection of the health of our colleagues and all the passengers in our care.”