Philippine Airlines (PAL) is an airline on a mission. Not only is the airline determined to strengthen its position in the Asian airline market, to better compete with the likes of Cathay Pacific, Singapore Airlines & Japan Airlines, but the airline is also in the midst of an internal campaign which works towards one goal: becoming a ‘Skytrax’ 5 star airline.
Philippine Airlines’ (currently a ‘Skytrax’ 4-star airline) determination for ‘the extra star’ shapes and influences their corporate decisions, acquisitions of new aircraft, and investment in cabin products. While there is some doubt in the industry over the legitimacy of the star-awarding company — notably from Turkish Airlines, who is voluntarily exempting itself from all future ‘Skytrax’ audits, citing a lack of trust in the firm — Philippine Airlines say it has complete faith in the ‘Skytrax’ audits, and hence it will continue to work towards the fifth star.
In what is Philippine Airlines’ latest step towards becoming a 5-star airline, Mr Jaime Bautista (President, Philippine Airlines) has exclusively revealed to me that the airline is ‘now in the process’ of joining one of the three major airline alliances. Bautista told me “the alliance has told us it’s probably going to to be a 2 year process, but nevertheless it’s a process that has already started”
For now, the exact alliance Philippine Airlines is in the process of joining has to remain confidential, but what Bautista can say is “the alliance membership will help give Philippine Airlines access to more interior points in Europe and North America, as well as the continents of Africa and South America where we can tap new sources of traffic.”
The news is long overdue, Philippine Airlines has been the only major Southeast Asian flag carrier that is not in a global alliance for over four years. Philippines’ ‘premium’ routes, such as London, are more challenging for the airline compared with their neighbouring Asian flag carrier counterparts, as Philippine Airlines cannot rely on connecting traffic to keep the route profitable. Furthermore, there is heavy competition in the London-Manila market, and Gulf carriers such as Emirates and Qatar Airways offer relatively swift one-stop options that have the ability to connect secondary city European flights with Manila bound long haul flights.
Potentially Ruling Out: Star Alliance (the largest alliance, in terms of airline members)
A lot can change in three years, but Star Alliance’s position on Philippine Airlines joining as a member probably hasn’t. Back in 2015, Star Alliance Chief Operating Officer Jeffrey Goh, told local Filipino media “There is no immediate need to be focusing on recruiting a member from the Philippines. I would not say that we see Philippine Airlines as a prospective new member. Clearly, if you just think about the network of Philippine Airlines today, they have overlapping services with some of our members.”
Of the 27 member carriers of Star Alliance, Ethiopian Airlines, United, Turkish Airlines, Thai Airways, Air China, Asiana, Singapore Airlines, Eva Air and All Nippon Airways operate at Manila Airport — with the last six operating from the same continent. However, it’s not the most ‘solid’ business case for declining Philippine Airlines membership, as most of the alliances have multiple members from the same continent, or sometimes region.
oneworld alliance and Skyteam
Skyteam has a strong presence in Asia, with most of China’s large carriers as members. For Philippine Airlines, the isn’t a need for intra-Asia connections, as the airline covers most of Asia through its short-haul network, and PAL Express airline subsidairy. However, what SkyTeam would provide for Philippine Airlines’ passengers, is access to some of Europe’s biggest carriers (Air France/KLM), along with the opportunity to feed Delta Air Lines passengers in the US onto their New York-Manila service.
For oneworld — it seems like a no brainer. Philippine Airlines has been rumoured as ‘the next member’ for quite some years, but being the an Asian airline knocking on the doors of alliances well-stocked with Asian airlines has proven to be difficult. There is an obvious attractiveness to the alliance that overshadows the other alliances, given oneworld’s three largest members: American Airlines, British Airways, and Qatar Airways. With oneworld membership, Philippine Airlines would have access to a year-round, solid flow of passengers from Europe, the Americas, and Africa via the Middle East.
This is incredibly overdue news for the flag carrier of the Philippines, but it’s exciting too. While there’s still some time until PAL are a firm member of any alliance, it’s reassuring to hear that the airline is already in the process (as of mid-2018).
Personally, I believe Philippine Airlines would be best suited as a member of the oneworld alliance. Compared with SkyTeam, the oneworld alliance is not as heavily saturated when it comes to Asian airline members, and it’s been a while since oneworld introduced a new member airline to the alliance.
Which alliance would you like to see take on Philippine Airlines as a new member?