PAL retrenches 300 employees amid COVID-19 downturn - Aviation Updates Philippines | Latest Philippine aviation news

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PAL retrenches 300 employees amid COVID-19 downturn

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Aviation Updates Philippines – The massive Coronavirus Disease 2019 (COVID-19) outbreak forced the national flag carrier Philippine Airlines to cut 300 ground-based administrative and management personnel as the full-service airline struggles to generate profit owing to a colossal passenger volume decline.
RESTRUCTURING PROCESS. Philippine Airlines, on Friday, has completed a business restructuring plan to save the airline from further losses. Photo by Dirk Salcedo – PPSG/AUP.
On Friday, PAL announced that it would be retrenching 300 jobs, mostly office-based personnel, 'voluntarily' after completing a business restructuring plan in a bid to reduce costs and increase profit. PAL, in a statement, said it would offer "appropriate separation benefits, additional trip pass privileges, and assistance in the form of career counselling and outplacement support."

The airline added: "Other initiatives include revenue generation from an optimized route network and new ancillary products, more aggressive cost-management efforts, and investment in digital technology."



Over the past few months, PAL was forced to cancel most of its profit-generating routes to China, Hong Kong, Macau, and now, South Korea. The significant reduction in capacity meant a bigger problem for the financially-bleeding airline that is currently still in red since 2017.

Hong Kong's Cathay Pacific, meanwhile, was also suffering from a massive blow to its operations after cancelling the majority of its flights and slashing frequencies to its vital international routes. Early in February, Cathay has asked 27,000 staff to take a three-week unpaid leave in the coming months given the company's struggle in maintaining cash reserves to operate in the future.

Although PAL has not released its full year-on-year financial report for the fiscal year 2019, the first nine months of the airline's operations proved to be a massive setback as it reported a $166 million net loss per a report from the Nikkei Asian Review.

Earlier, the International Air Transportation Association (IATA) estimated that Asia-Pacific airlines would collectively incur losses of up to $27.8 billion due to falling passenger traffic and a severe economic downturn mainly from Asian countries.

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