Local airlines seen to lose P250 B this year

Losses of local carriers Philippine Airlines, Cebu Pacific and AirAsia Philippines have hit P5 billion in the first quarter, and could potentially reach as much as P250 billion this year.

“In terms of the first quarter performance for the ACAP carriers, we have a P5- billion loss,” Air Carriers Association of the Philippines (ACAP) executive director and vice chairman Roberto Lim said during the Senate Committee on Public Services hearing Monday.

Lim said losses would further accelerate with no revenue being generated by the airlines due to the suspension of commercial flights.

“Any extension of the quarantine, of course, will further increase the losses,” he said.

“If we are to extend the nonrevenue of the domestic carriers and the low revenue, assuming it happens in the latter part of the year, the losses will really be very, very large,” Lim said.

The country’s largest budget carrier Cebu Pacific already reported a P1.18 billion net loss in the first quarter as travel restrictions brought about by the coronavirus disease 2019 or COVID-19 pandemic started taking its toll on its operations.

Citing data from International Air Transport Association (IATA), Lim said losses for the local airline industry this year could hit as much as P250 billion.

IATA’s latest estimates released last month showed that passenger demand in the country could decline by 47 percent this year compared to 2019, resulting in a revenue loss of $4.48 billion.

These figures are worse than IATA’s March assessment for the Philippines which estimated a 36 percent year-on-year drop in passenger demand that would translate to a revenue loss of $3.51 billion.

Potential job losses could now reach as much as 548,3000, up from previous estimates of 419,800 job losses.

Lim said ACAP members currently have about 25,000 regular employees. However, he said there are hudreds of thousands employed by associated entities that support the airline industry.

At present, he said there has yet to be a large-scale lay off of employees in the country’s airline industry.

“The important thing for is to be able to fly again,” he said.