PHILIPPINE AIRLINES (PAL) is considering a plan to replace its Fokker 50 turboprops with a fleet of new turbofan aircraft. The move is designed to enable domestic fares to be raised and airline losses reduced.

The airline operates ten Fokker 50s, leased from AFT, for use on domestic routes, but suffers from low passenger yields. PAL lost 452 million peso ($17.5 million) in 1994 and expects to lose a further 1.4 billion peso by the end of this financial year in April.

PAL estimates that with the use of a regional jet on routes under 200km (110nm), it could increase domestic air fares by up to 35%, while ticket prices for journeys of over 200km would rise by just under 20%.

The airline plans initially to make greater use of its Boeing 737-300s on domestic services in place of Fokker 50s. In the longer term, PAL wants to replace its entire fleet of turboprops with a new aircraft, preferably a jet.

Possible replacements being evaluated by PAL include the Avro RJ85, the 50-seat Canadair RJ and Fokker 70 twinjet. Not all of PAL's domestic destinations, however, are equipped for jet aircraft and it also considering alternative turboprop aircraft, such as the Saab 2000.

The study and evaluation of replacement aircraft, is expected to be completed early in 1996. The carrier's Fokker 50s have been leased over a ten-year period, the first of which is not due to expire until the third quarter of 1998. A further five aircraft are scheduled to be returned in 1999

According to a senior PAL manager, it will want to renegotiate the leases and return the aircraft early if the airline continues to "haemorrhage money."

PAL is meanwhile negotiating financing to purchase two new Boeing 747-400s from Japan Airlines (JAL). The two aircraft were originally ordered by PAL in 1992 as part of a larger planned purchase of four 747-400s. The order was later halved as part of a cost-cutting drive and the aircraft sold to JAL.

Source: Flight International