By Arjay L. Balinbin, Reporter

JUVY P. CASTILLON, a 54-year-old grade school English teacher in Bangkok, Thailand, is scheduled to return to General Santos City via Ninoy Aquino International Airport in Pasay City on March 21.

She resigned from her job, and her work visa will expire on May 13.

She needs to be home as soon as possible because she’s worried that Thailand’s Prime Minister Prayut Chan-o-cha would also declare a lockdown in the capital to contain the spread of the new coronavirus disease.

“If that happens, I might be forced to overstay my visa and pay 500 baht per day for the penalty,” she said.

In the Philippines, President Rodrigo R. Duterte ordered a one-month halt to land, domestic air and sea travels to and from Metro Manila from March 15 to April 14.

The alert level was raised to code red sublevel 2, which means there have been community transmissions and increased infection cases in the country.

“I don’t know what will happen to my flight. I am still waiting for an update from the agent who booked my ticket, and I can no longer avail of the free rebooking because I had the schedule changed from April 16 to March 21 before the President made his announcement last Thursday,” Ms. Castillon said by phone on Sunday.

“I had to borrow money from a friend for my ticket. If I need to get a new one to reroute my domestic flight from Manila to Clark or maybe Cebu just to get to Gensan (General Santos City), I will have to wait for my last salary. But I don’t want to stay longer here because the situation might get worse in the coming days,” she added.

Ms. Castillon is among Filipinos, at home and overseas, whose travel plans have been affected as transportation companies adjust to meet government directives while trying to stay afloat until the situation returns to what it was before the pandemic.

Philippine Airlines (PAL), Cebu Pacific, and Philippines AirAsia have announced the cancellation of their domestic flights to and from the capital in view of Mr. Duterte’s order.

This was followed by the cancellation of their selected flights to Mactan Cebu Airport in line with the directives from the provincial government of Cebu prohibiting the entry of passengers into the province via air from Clark, Legazpi, Dumaguete and Cagayan de Oro.

PAL Spokesperson Cielo C. Villaluna said in a phone interview on Sunday that the flag carrier operates 125 domestic flights out of its hubs daily. “Of this number, 66 flights originate in our Manila hub.”

PAL, operated by PAL Holdings, Inc., also operates 57 international flights daily. Of those flights, 52 originate in Manila.

“To stay afloat, we are carrying out cost-control measures. We started with phase 1 which is business restructuring by implementing the voluntary and the involuntary retirement program,” Ms. Villaluna said.

PAL recently cut about 300 jobs as a way to recover from its 2019 losses, which worsened in the first two months of 2020 due to the impact of the new virus on its operations.

“We will carry out more cost-control measures, which will be taking affect soon, to cushion the impact of the virus to keep the company afloat and to allow us to continue serving our passengers,” Ms. Villaluna added.

She also lauded the government’s action deferring the collection of take-off, landing and parking fees from Philippine carriers as a form of relief from the pandemic.

In the nine months ending September 2019, the attributable net loss of the listed operator of PAL widened 116.2% to P8.5 billion from the previous year’s P3.92 billion, as expenses and financing charges increased.

Revenues rose 5.6% to P117.92 billion, primarily as passenger and ancillary revenues increased due to additional frequencies and new routes which contributed to the growth in passenger volume. Passenger revenues grew 5.76% to P102.7 billion.

Cebu Pacific Director for Corporate Communications Charo L. Lagamon told BusinessWorld in a phone message that “more or less 200 [domestic] flights per day” are affected.

Cebu Pacific said that as of September 2019, the budget carrier had a total of 2,727 scheduled weekly flights. Ms. Lagamon said 70% of those flights are domestic.

The budget carrier announced recently that its senior management officials had decided to take a pay cut as the new virus continues to affect its operations.

In a disclosure to the stock exchange on Monday, the budget carrier’s listed operator Cebu Air, Inc. (CEB) said it expects a “significant revenue impact” during the 30-day quarantine period with the suspension of its flights.

“As a material portion of its operating expenses are based on flights and flight hours, CEB anticipates its expenses to likewise reduce significantly. This includes lower fuel consumption, landing, take off and air navigation fees, and flight-based repair and maintenance expenses. Lower fuel price adds a cost benefit with lower fuel consumption, but CEB also faces increase in refund and rebooking requests,” it said.

As of September 2019, CEB reported its passenger revenues jumped 18% to P46.59 billion.

The company attributed its growth to the 10.4% increase in passenger volume to 16.7 million from 15.1 million for 2018 as it added bigger A321 aircraft to its fleet.

PAL, Cebu Pacific, AirAsia have cancelled flights between China, Hong Kong, Macau, and parts of South Korea amid travel restrictions because of the virus.

AirAsia, a unit of Malaysia’s Airasia Group Bhd., said 102 daily domestic flights in and out of Manila are affected.

David F. de Castro, its head of communications, said in a phone message on Saturday that the low-cost carrier has 1,104 domestic flights and 104 international flights in a week.

In an e-mailed reply to questions on Sunday, Avelino D.L. Zapanta, aviation expert and former president of PAL, said: “Since Manila is the true origin and true destination of more than half of domestic travels, the impact will obviously be huge, particularly to local airlines that fly only the domestic routes.”

“For PAL with a big international network, the impact will not be much because their international flights will continue to operate. Many will most likely postpone international travels particularly foreign tourists, but business travels will likely continue depending on the status of destinations e.g. being locked down or not,” he added.

Generally, the airlines would lose much in the period of flight suspension, he said.

Mr. Zapanta said the government should contain the virus at the earliest possible time and lift the community quarantine as warranted by the situation.

“For the period of flight suspension, the airlines must take it as the opportunity to keep all their aircraft in tiptop condition i.e. airworthy. After the flight suspension, there will be a rush for travel both ways. The airlines must be prepared to operate, if possible, as many extra sections i.e. additional flights to accommodate the big demand that would develop,” he said.

PAL’s Ms. Villaluna said the flag carrier will be preparing for the expected surge in demand after the community quarantine period. “We will do our best to re-accommodate the passengers who were affected by the cancellations. If there is a need to mount extra flights, we will study that.”

In a phone interview on Saturday, The Wallace Business Forum Vice-President and Chief Operating Officer Benvenuto N. Icamina said international visitor arrivals will fall this year, not just during the implementation of the one-month community quarantine in Metro Manila.

“There will be at least 10% decline in the tourism arrivals and worst is 40%,” he said.

He said the impact on the passenger revenues will be huge. “PAL for example, even without the coronavirus, was already having problems, so how much more now?” Mr. Icamina said.

BIGGER IMPACT ON PASSENGER SHIPS
Mr. Icamina said the community quarantine will have a bigger impact on passenger ships.

“That’s probably larger kasi these are for low to middle income passengers, especially for some remote areas where ferry passengers outnumber airline passengers,” he said.

“So there’s going to be a huge impact on ferries,” he added.

He said listed ship operator and logistics firm 2GO Group, Inc. (2GO) will struggle further because of the community quarantine.

“They have to take a hit. Talagang ganyan ang mangyayari (That’s what will happen) for a few months. Probably, they will have to come together and rationalize,” he added.

He said cutting of jobs is also one of the main options to keep the business afloat.

On Friday, 2Go announced the cancellation of its voyages to and from Manila from March 15.

“For now, voyages to and from Manila from March 15 are canceled. We are monitoring government advisories on a daily basis and once clearance is provided, we will resume normal operations,” 2Go said in an advisory.

It said the cancellation advisory does not cover its freight and cargo services.

The company also canceled its Cagayan de Oro-Manila and Cebu-Manila trips on Friday.

2GO swung to an attributable net loss of P189.37 million during the first half of 2019, from a profit of P199.39 million for 2018.

Its sixth-month revenues went up by 5% to P12 billion, much of which was driven by stronger returns from the company’s non-shipping business.

Non-shipping revenues accounted for 59% of the company’s revenue pie in the first half of the year, while the remaining 41% came from shipping revenues.

Chelasea Logistics and Infrastructure Holdings Corp. reported recently that a significant portion of its net loss of P832 million last year can be attributed to its share in net losses of 2Go Group and DITO Telecommunity Corp. totaling to P483 million.

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