The Philippines’ national carrier, Philippine Airlines, is seeking approval from the Civil Aeronautics Board (CAB) to allow them to collect fuel surcharge on all destinations to make up for the soaring costs of jet fuel prices.
“We have filed a petition for a fuel surcharge, but it’s being acted by CAB. There will be some hearings. I hope that they can act on it as soon as possible,” said PAL president and Chief Operating Officer, Jaime Bautista, of their latest move.
He added PAL filed the petition to slap on fuel surcharge as early as December 2017.
A fuel surcharge is a temporary relief given to airlines to help them bounce back from losses incurred from higher jet fuel costs. Fuel makes up for about half of an airline’s operating cost per passenger, and is the second-highest expense next to labor.
Bautista said Hong Kong and the United States have permitted carriers to impose fuel surcharge.
The CAB halted the imposition of fuel surcharge in all domestic and international flights back in 2015 because jet fuel prices then were not so burdensome
“We hope CAB considers our petition favorably,” Bautista disclosed.
Carmelo Arcilla, the Executive Director of the CAB, responded that a hearing ould be held on the last day of this month for the petition of PAL.
“We are still evaluating PAL’s petition,” he said.
Data gained from the International Air Transportation Association (IATA) indicated that jet fuel prices averaged $78.1 a barrel as of February 9, up by 17.8% from the year before. And according to IATA, it won’t get any better as they project the price to go up to $82.2 a barrel this year.
In related news, Bautista revealed that PAL’s fleet is waiting for the delivery of four Airbus 350s, six A321 Neo and five Q400s aircraft this year.
“Based on the lease price [the 15 aircraft will cost] almost $2 billion,” Bautista divulged.
Bautista said the first A350-900s is expected to arrive in June, letting PAL deploy non-stop flights to the US east coast through the Polar region and to more European destinations.