Philippine Airlines to offer low-cost economy seats
Published: 24/06/2013 - Filed under: News »
Philippine Airlines is to configure its planes with three separate economy class cabins - the first ever carrier, it is believed, to do so.
To cater for budget-minded passengers, PAL will launch a new and separate "low-cost carrier" zone to complement the existing premium economy and regular economy cabins.
According to aviation newsletter Philippine Flight Network, the narrow-bodied A321s arriving in August will be configured with 12 business, 36 premium economy, 104 regular economy and 50 low-cost economy seats.
The wide-bodied A330-300s which arrive in October will be laid out for 18 seats in business, 36 in premium economy, 264 in regular economy with 50 low-cost economy seats right at the back.
So why is PAL adopting this strategy? It's all to do with competition from the growing number of Asian low-cost carriers (LCCs) which are now operating within the region and farther afield and are providing fierce price competition.
PAL president Lucio Tan had previously indicated that his airline was carefully evaluating the configuration of its aircraft to maximise revenue from passengers.
Little information is currently available on what prices PAL will be charging passengers.
But the seating layout will be tight and in the rear zone, especially on the A330s (normally configured eight across 2-4-2), PAL is expected to follow domestic LCC rival Cebu Pacific and opt for nine across 3-3-3.
It is likely that meals, drinks and IFE will come at extra cost.
Increasing price competition in the back of the plane means that traditional airlines make little if any money from their economy class tickets. Instead, the profits come from ancillary charges like those for seat selection, baggage check, onboard food etc (see our feature on ancillary charges in the forthcoming July/August issue of Business Traveller).
Airline manufacturers are now designing planes specifically for carriers who wish to tap this new market.
Speaking at a media event at last week's Paris airshow, Mike Blair, Boeing's VP of marketing and business development, said: "We [the aircraft manufacturers] focus a lot on operating costs but this revenue generation [from ancillary fees] is really, really a big deal.
"We're doing things to help the airlines match their products to the customer so the ability to customise the [plane's] interior or reconfigure and upgrade is really important."
Boeing is engineering the cabin of its forthcoming B777X (an updated version of the existing B777) so that airline customers can more easily install more profitable ten-across (3-4-3) seating.
So perhaps PAL is leading the pack. What PAL does now will be emulated by other carriers in the years ahead.
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