Philippine Airlines files for bankruptcy
Last Friday, Philippine Airlines (PAL) filed for U.S. Chapter 11 bankruptcy according to Bloomberg. While this is an indication of serious financial trouble within a company, it is not (yet) shocking for flyers - the airline is permitted to continue normal operations while trying to restructure debt and other financial means in order to survive.
Tickets will keep their value and the airlines Mabuhay Miles loyalty program will keep operating as usual.
While it may seem counter-intuitive that the Manila-based airline is seeking bankruptcy in the United States, this is often the case with multinational companies due to them having an entity in the U.S. for regulatory reasons. With this bankruptcy case, filed in New York, the airline hopes to be released of some debt and to reduce its fleet by 25%.
Both Boeing and Airbus planes will be returned to their lessors, bringing the fleet down from 92 to 70 aircraft. Also, the airline will ask Airbus to delay the arrival of 13 new narrow-body jets. Like other airlines worldwide, PAL has temporarily grounded some of its fleet while demand for air travel remains low.
In many similar cases, we have seen struggling South East Asian airlines transform into a more regional-first airline. For example, Malaysia Airlines, Garuda Indonesia and Thai Airways have all become more focused on their regional operations after restructuring processed triggered by decreased demand due to the pandemic.
Currently, there is no indication if the fleet reduction will impact mainly regional or mainly intercontinental operations. The airline has been aiming for a higher quality of intercontinental service by offering flights on new Airbus A350s to prime destinations like New York (JFK) and London Heathrow (LHR) in recent years.
However, given the strong network in the region and relatively few longer flights, it might make more sense for the airline to put regional flights first.
Related: A Review of Philippine Airlines' A350 in Economy From Manila to New York
Times are still tough for the airline industry. The intercontinental airlines, with flag carriers such as British Airways, KLM and Lufthansa, rely on business travel to make money. Although passengers numbers as a whole are on the rise again, the proportion of business versus leisure travelers is way off compared to pre-pandemic numbers. This balance leads to leisure-heavy airlines flourishing, while more traditional airlines are still struggling to stay afloat.
TPG featured card
at Bilt's secure site
Terms & restrictions apply. See rates & fees.
| 1X | Choose to earn up to 1X points on rent and mortgage payments with no transaction fee |
| 2X | Earn 2X points + the option to earn 4% back in Bilt Cash on everyday purchases |
Pros
- Choice to earn up to 1 Bilt Point per dollar spent on rent and mortgage payments
- Elevated everyday earnings with both Bilt Points and the option to earn Bilt Cash
- $400 Bilt Travel Portal hotel credit per year (up to $200 biannually)
- $200 Bilt Cash annually
- Priority Pass membership
- No foreign transaction fees
Cons
- Moderate annual fee
- Designed primarily for members seeking a premium, all-in-one card
- Earn points on housing with no transaction fee
- Choose to earn 4% back in Bilt Cash on everyday spend. Use Bilt Cash to unlock point earnings on rent and mortgage payments with no transaction fee, up to 1X.
- 2X points on everyday spend
- $400 Bilt Travel Hotel credit. Applied twice a year, as $200 statement credits, for qualifying Bilt Travel Portal hotel bookings.
- $200 Bilt Cash (awarded annually). At the end of each calendar year, any Bilt Cash balance over $100 will expire.
- Welcome bonus (subject to approval): 50,000 Bilt Points + Gold Status after spending $4,000 on everyday purchases in the first 90 days + $300 of Bilt Cash.
- Priority Pass ($469/year value). See Guide to Benefits.
- Bilt Point redemptions include airlines, hotels, future rent and mortgage payments, Lyft rides, statement credits, student loan balances, a down payment on a home, and more.