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Article - Features

Philippine Airlines vs United/Air Canada - A more competitive Philippine-North America market

by Jeffrey Teruel - Founder/Editor-Flights in Asia
Published on December 12, 2024

Summary

With the entry of new flights from United Airlines and Air Canada, Philippine Airlines now faces new challenges to its dominance on flights between North America and its home turf.





After years of Philippine Airlines being the sole airline operating trans-Pacific flights from the Philippines to North America, the market changed in late 2023 with the start of United Airlines' flights from San Francisco to Manila – the first non-stop flights from the US mainland to the Philippines by a US-based airline. Within a year, United then surprised many aviation observers with the addition of the central Philippine city of Cebu its network through a Fifth-freedom flight from Tokyo-Narita. Following United's recent expansion in the Philippines, Air Canada will become the first Canadian airline to launch flights to the Philippines with its Vancouver-Manila route next summer. As a result, Philippine Airlines will now have competition on flights from the Philippines to both the US mainland and Canada. Travelers now have more options when it comes to crossing the Pacific to the Southeast Asian country.


Airline Services Overview


Except for the direct flights operated by Philippine Airlines, the main alternatives for travelers from the US and Canada was a connection at a third city - such as Tokyo, Seoul, and Taipei - before reaching the Philippines. Airlines such as United and Air Canada sell codeshare flights operated by Star Alliance partners in the region such as All Nippon Airways (ANA), mostly to Manila. Another option is taking United's flights from Guam to Manila, which requires another connection in Honolulu from its US mainland hubs.


Now, both United and Air Canada are taking it to themselves to launch new routes to the Philippines. After years of operating flights between Guam and Manila, United launched its San Francisco-Manila route in October 2023. United then followed it up with a route that surprised many observers – between Tokyo-Narita and Cebu – which started in October 2024. Meanwhile from Canada, Air Canada will launch its new route from Vancouver to Manila with four weekly flights by the summer of 2025. As a result, the Philippines has benefited from the ambitious expansion plans of both North American-based airlines.


Image: United Airlines inaugural San Francisco-Manila flight water cannon salute upon arrival in Manila. October 30, 2023. (Credit: Manila International Airport Authority)


Image: United Airlines and officials of the Mactan Cebu International Airport celebrate the inaugural Cebu-Narita flight departure from Cebu. October 28, 2024 (Credit: Aboitiz/Mactan Cebu International Airport) 


Until Air Canada's highly anticipated inaugural flight next summer, the two airlines offering direct air services between North America and the Philippines as of December 2024 are Philippine Airlines and United. Combined, both airlines operate a total 72 weekly flights to/from Manila and Cebu. Minus United's Palau-Manila, and Narita-Cebu flights, the market is served with 63 weekly direct flights between the Philippines to six points in the US. Both airlines compete on the flights from Manila to Guam and San Francisco. Air Canada will compete with Philippine Airlines on the Manila-Vancouver route. 




The San Francisco-Manila and Narita-Cebu services adds to the routes United inherited from the former Continental Airlines to the Philippines. The Chicago-based airline operates a total of 23 weekly flights to/from both Manila and Cebu, with the majority at Manila (16). United offers flights from Manila to Palau, Guam, and San Francisco. Daily flights are offered on three of the four routes – from Manila to San Francisco and Guam, and Narita-Cebu. 



While now seeing new challengers on direct routes it previously served without contest, Philippine Airlines is still is by far the top airline when it comes to direct flights between the Philippines and North America. From Manila, Philippine Airlines operates around 49 weekly flights on eight routes – 6 to the US and 2 in Canada. Its US/Canadian destinations include Guam, Honolulu, San Francisco, Los Angeles, New York, Seattle, Vancouver, and Toronto. Daily flight are offered to Guam, San Francisco, Vancouver, and Los Angeles - the busiest of the routes with two daily flights. 



Fifth-freedoms and Partners


Even with the new challenges, Philippine Airlines will still have the big advantage between the Philippines and North America for the foreseeable future. In addition to having the best trans-Pacific network among ASEAN-based airlines, the routes cater to overseas Filipinos living in the US and Canada. Filipinos returning home can take advantage of Philippine domestic connections operated by the Philippine flag carrier, while travelers can also connect to other Southeast Asian points such as to Kuala Lumpur, Bangkok, and Jakarta. The airline is awaiting the delivery of Airbus A350-1000 aircraft, which will help address current fleet restrictions, and open new routes such as to North America. Using the A350s, Philippine Airlines could fill a gap in its US network in the central/midwest, potentially serving the area's hubs such as Chicago, Dallas, and/or Houston. 




While the Philippines is ground for expansion by United and Air Canada, it is part of their overall long-haul plans and may not be their highest priority. However unlike Air Canada, United does have more flexibility to expand in the country thanks to having its Guam-based Boeing 737s and flight crew. United could explore opening more long-haul routes to Manila such as from Newark – its New York City and US East Coast hub, though the airline probably would be better focused on using an aircraft that would be used for a New York-Manila route on a lucrative trans-Atlantic route instead. United does have the potential to add new destinations to the Philippines such as Clark and Davao using Fifth-freedom rights from Tokyo. Using the same strategy as the Narita-Cebu route, the airline could take advantage of the connecting options at Narita by United and ANA to the US mainland. 


Now with the addition of Air Canada, Star Alliance will be more represented on trans-Pacific flights to/from the Philippines. Noticeably absent are Delta Airlines and American Airlines. After dropping Manila from its network amid the pandemic, Delta currently relies on its joint venture partnership with Korean Air for connections via Seoul to Manila, Clark, and Cebu. American Airlines does have a codeshare partnership with Philippine Airlines covering connections via Tokyo to Manila and Cebu. In return the American-Philippine Airlines partnership covers US domestic connections from Los Angeles.



Future Surprises in the Works 


Unlike United, Delta and American do not seem keen on expanding in Asia. Though it does not mean never – United surprised everyone with new destinations in Asia from Narita. Delta – which operated flights to Manila from Narita before the pandemic – could make a comeback either from Seoul or follow United with its own new route from the US mainland. Following its announcement of plans to launch trans-Pacific flights from Seattle to Tokyo Narita and Seoul Incheon in 2025, Manila could be included as part of the newly merged Alaska Airlines/Hawaiian's plans for Asia. Existing players – specifically United and Philippine Airlines – do have potential opportunities to further expand their share of direct flights between the Philippines and the US.


While Philippine Airlines continues to be dominant when it comes to flight offerings to the Philippines from the US and Canada, we could still get more surprises with more new routes and US-based airlines adding the Philippines to their networks.

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