Business Travellers rejoice – Philippine Airlines to offer all lie flat product in Australia and NZ market

Philippine Airlines (PAL) is upgrading its product on the Brisbane-Manila route on 2-Jul-2018 as A321neos are introduced.


Highlights:

  • Philippine Airlines will begin deploying new A321neos with lie flat business class seats to Brisbane in Jul-2018;
  • Brisbane will be the last of PAL’s Australia/New Zealand markets to be upgraded to a lie flat product;
  • PAL is upgrading Auckland in Jun-2018 as retrofitted A330s replace A340s;
  • PAL upgraded its product in Melbourne and Sydney in 2017 as it introduced new low density A330-300s in these markets.

PAL’s new fleet of long haul configured A321neos feature 12 lie flat business class seats and 156 economy seats with seatback IFE monitors. It will be the first and only narrowbody aircraft in the Australian market with lie flat seats.

PAL currently serves Brisbane three times weekly with 254-seat A340-300s. Brisbane-Manila capacity will decline by 13% as PAL is only adding one frequency on the route as it transitions to smaller A321neos for a total of four frequencies. Business class capacity will decline by a staggering 56%.

However, PAL will offer a significantly improved product in both economy and business. PAL’s A340s have an outdated business class product with recliner style seats and overhead monitors in economy.

The A321neo is a better fit for Brisbane given the relatively small size of the market. The A340 is clearly too big for the market, particularly the 48-seat business class cabin.

The introduction of A321neos to Brisbane means all PAL flights to Australia and New Zealand will offer lie flat business class seats. This is a remarkable achievement given that a year ago none of PAL’s Australia and New Zealand flights had a lie flat product.

PAL introduced a lie flat product in the Melbourne and Sydney markets last year as Melbourne and Sydney were two of the initial routes for its fleet of newly retrofitted A330-300s. PAL will also introduce retrofitted A330-300s on the Auckland-Manila route from 17-Jun-2018. Auckland-Manila is now operated with the same A340-300s used on Brisbane-Manila.

The retrofitted A330-300s have 309 seats, including 18 lie flat business class seats, 24 premium economy seats and 267 regular economy seats. The retrofitted A330s and new A321neos have the same new generation IFE system and WiFi connectivity.

In-flight product improvements are an important component of an initiative at PAL to secure a five-star rating. PAL secured a fourth star from Skytrax in Feb-2018.

The A340 was always viewed as temporarily solution for Auckland and Brisbane as PAL is aiming to phase out the type by the end of 2019. PAL launched nonstop flights to Auckland in Dec-2017 and nonstop flights to Brisbane in Mar-2018. Auckland was previously served via Cairns with A320s while Brisbane was previously served via Darwin with A320s. PAL no longer serves Cairns or Darwin, which generated limited traffic compared with Auckland and Brisbane.

PAL initially aimed to launch nonstop flights to Brisbane with A321neos but engine related A321neo delivery delays forced it to initially use A340s. PAL also needed to wait for Australia’s Civil Aviation Safety Authority (CASA) to approve the A321neo as it will be the first operator of the type in the Australia market.

PAL plans to take delivery of its first A321neo within the next few weeks. The aircraft will be temporarily used on regional routes before being introduced to Brisbane.

PAL expects to receive six long-haul configured 168 seat A321neos by the end of the year. The new type will also be used to upgrade Melbourne-Manila to daily and Sydney-Manila to double daily. However, PAL plans to continue using retrofitted A330s on some of its Melbourne and Sydney flights and all its Auckland flights.

From a product perspective, the retrofitted A330-300 and long haul configured A321neo are similar with the exception of premium economy, which will only be available on the flights operated with A330s. PAL ideally would offer a consistent premium economy product in the Australia and New Zealand market. But not offering premium economy flights is manageable. Offering consistent lie flat business class product is more important and should improve PAL’s its position in the Southwest Pacific market.