Philippine Airlines (PAL), the flag carrier of the Philippines, has enough cash to survive the coronavirus crisis, at least for now. In an interview with ABS-CBN, the airline’s president Gilbert Sta Maria stated that the carrier wouldn’t be going bankrupt because of the pandemic just yet.
According to Sta Maria, this is thanks to the $600 million capital infusion approved by the company’s shareholders last February, of which half has already been burnt as a result of the lack of travel demand and subsequent fleet grounding which the airline had been forced to implement after countries started shutting their borders. He also added that if it hadn’t been for the extra cash, the airline would probably not exist anymore.
Philippine Airlines Boeing 777-300ER at San Francisco. Photo by Chris Phan | AeroNewsX
However, the problem hasn’t yet been resolved and the airline continues to lose $300 million per month as travellers stay home and countries maintain lockdown and quarantine policies. As mentioned by Sta Maria, the airline has already lost around $1 billion since the start of the pandemic.
Nevertheless, PAL isn’t the only airline in the region which is struggling. Last month, Cebu Pacific, Air Asia and PAL asked regulators for financial rescue as losses began to pile up and their income saw a sharp decline. Philippine Airlines stated that it would be best if laying off staff could be prevented, however that depends on how quick the recovery of travel will be.
The pandemic has already been going on for almost half a year and we have witnessed many airlines and even aircraft types becoming victims of it. In addition to Philippine Airlines, many other carriers are struggling to stay afloat - it remains to be seen how the aviation industry will emerge after the pandemic passes.