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Philippine Airlines targets head office cost reductions
August 16th 2019
Lucio Tan engages Lufthansa Consulting. Read More »
Philippine Airlines (PAL) vice-chairman Lucio Tan wants to reduce what he calls its “very administration-heavy” cost of operations. PAL has engaged Lufthansa Consulting with Tan saying there could be “good results” within six to eight months, according to Business World Online.
Tan also sees promise from newly-appointed president and COO Gilbert Santa Maria. He was previously COO of Washington, D.C.-based IBEX Global Solutions, an outsource provider. Tan said PAL may learn best practices from All Nippon Airways, which invested in PAL earlier this year.
Echoing Thai Airways International, Tan wants to boost online ticket sales. Less than 20% of PAL’s tickets are sold online, he said. Tan summarised the project by saying there are “a lot of low-hanging fruits”.
PAL has been in loss since 2017, but started this year with hopes of turning a profit. But now Tan has significantly lowered projections, saying he hoped PAL would post a loss lower than last year’s PHP838.17 million (US$15.9 million). Cebu Pacific’s profit doubled while PAL’s position significantly deteriorated from a 2Q2018 loss of PHP290 million (US$5.5 million) to PHP2.5 billion (US$47.4 million).
