Philippine Airlines—controlled by banking and tobacco tycoon Lucio Tan—has agreed to buy nine additional A350-1000 jets from Airbus, bringing to 18 its firm orders for the long-haul jets needed to support the flag carrier’s expansion in key North American destinations.
Philippine Airlines—controlled by banking and tobacco tycoon Lucio Tan—has agreed to buy nine additional A350-1000 jets from Airbus, bringing to 18 its firm orders for the long-haul jets needed to support the flag carrier’s expansion in key North American destinations.
PAL, Airbus and Rolls-Royce have signed definitive agreements for additional nine Airbus A350-1000 aircraft, with options for five more, and Trent XWB-97 engines, the Manila-based carrier said in a statement. The latest orders follows a preliminary agreement announced in July.
The aircraft will be used for the airline’s “next phase of long-haul growth,” said Lucio Tan III, president and chief operating officer of the airline’s parent, PAL Holdings, said in a statement. “We have seen what this aircraft can do,” he said. “It has allowed us to fly nonstop to North America with better fuel efficiency and a better experience for our passengers.”
PAL—the first and only airline in Southeast Asia to use A350-1000 jets primarily for nonstop flights to the U.S. and Canada—is stepping up its fleet upgrading even as the airline swung to a $159-million net loss in the first nine months of the year amid soaring jet fuel prices.
“While the sharp increase in fuel prices has weighed significantly on profitability, demand for travel remains healthy and our revenue performance shows that our commercial strategy is gaining traction,” Richard Nuttall, president of the airline, said in a statement earlier this week. “We remain focused on protecting liquidity, strengthening the business and positioning PAL for a return to stronger profitability as operating conditions normalize.”
The additional Airbus orders may cost PAL as much as $5.1 billion based on the aviation publication Simple Flying’s estimated list price for each A350-1000 aircraft of up to $366 million.
In a separate agreement with Boeing announced in July, PAL committed to purchase at least 15 Dreamliners, with an additional five on option. The planes are scheduled for delivery between 2031 and 2034. The additional A350-1000 jets are scheduled for delivery between 2034 and 2036, the airline said then.
The 85-year old airline currently has a fleet of 86 aircraft after taking delivery of three Airbus A350-1000 jets and two Airbus A320s earlier this year. It operates across the Philippines and 40 international destinations in Asia, North America, Australia and the Middle East.
Aside from PAL, Lucio Tan’s interests include banking, beer, spirits, tobacco and real estate through his publicly listed LT Group. Tan is among the wealthiest in the Philippines, with a net worth of $3.2 billion, according to Forbes’ real-time data.
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