Philippine Airlines (PAL) expects to incur an additional cost of more than $146 million by end of 2018 due to higher fuel prices and weakening of the peso.
As global fuel prices increased, PAL plans to amend its petition filed with the Civil Aeronautics Board (CAB) to adjust the fuel surcharge it wants to collect.
PAL president and chief operating officer Jaime Bautista said in a press conference following the carrier’s stockholders’ meeting, the price of fuel has increased by almost $13 from January to April.
“PAL will consume approximately 11 million barrels of fuel (this year). With a $13 increase, that would mean $143 million additional cost to PAL. And this is one of the reasons why we are urging government to allow us to collect fuel surcharge,” he said.
While PAL filed a petition to impose fuel surcharge of P51 to P207 to recover the higher costs of fuel last December, he said the CAB has yet to act on the matter.
“We’ll have to update this number considering price of fuel has gone up $13 from January to April,” he said.
Aside from higher fuel costs, he said PAL also expects to incur additional costs from the weakening peso.
“The impact of P1 depreciation would mean additional loss of $3 million,” he said.
PAL is looking to take in a strategic partner either through existing shareholders selling their shares or issuance of new shares, to make it easier for the carrier to achieve a five-star rating by 2020.
Bautista said PAL has mentioned in discussions with the potential strategic partner its efforts to file for a petition for fuel surcharge.
“We have mentioned to them we have filed petition for fuel surcharge. Also part of our fuel conservation program or reduction is entry of new and more efficient aircraft,” he said.