AIRASIA AVERTS SHUTDOWN, COMMITS TO PAY P 1.14B

Philippine Air Asia (PAA) narrowly averted a shutdown during the peak holiday travel season after agreeing to pay its P1.14-billion obligation with the Civil Aviation Authority of the Philippines (CAAP).

CAAP spokesperson Eric Apolonio told the Inquirer the budget carrier was able to settle the air navigation charges and concession fees before the 12 noon deadline set on Friday.

In a demand letter dated Dec. 15 and signed by CAAP Director General Manuel Antonio Tamayo, CAAP ordered AirAsia to settle their liabilities, which also included domestic passenger service charges or airport terminal fees.

If unpaid, the regulator said its recourse was to “disallow PAA’s operations in all CAAP-owned facilities starting with PAA’s operations at Puerto Princesa” by Dec. 16.

“They settled already so [AirAsia continues to have] normal operations,” he said, noting that no flights were suspended.

Suspending flights this month is seen to hurt the lowcost airline financially given the anticipated rise in bookings as passengers are encouraged to travel during the holiday season, especially with the easing of mobility restrictions.

“Other carriers are also facing the same challenge but they readily committed to paying their fees and offered us a payment schedule,” Transportation Secretary Jaime Bautista told the Inquirer.

“As for AirAsia, we’re willing to sit down with them as long as we see commitment on their part to pay these arrears,” he added.

PAA confirmed with the Inquirer they had reached an agreement on the payment terms of their outstanding obligations with the CAAP.

“This shall ensure our stakeholders, most especially our guests, that our operations will be business as usual,” it added.

PAA shared that the budget carrier, despite the recent resurgence of air travel, was also adversely affected by the pandemic that grounded flights in the past years.