CEBU, Philippines – Cebu-based shipping companies continue to cope with the stiff competition posed by low-cost airlines made worst by the fact that airline companies are enjoying more perks from the government such as on fuel subsidies.
Trans-Asia Shipping Lines Inc. vice president for marketing and sales Pinky Sy said the Government can save the shipping industry by leveling the playing field such as giving fuel subsidies to shipping companies or taking away the subsidy from airline companies.
"The government can help a lot. An open communication line between government regulating bodies and the shipping firms, especially in the implementation of new rules and guidelines, will be extremely helpful," she told The Freeman.
Sy said the effects of more low cost carriers (LCCs) to the shipping industry are "very grave," to the point that most shipping companies have downsized the passage accommodations on cities where LCCs serve.
Some, upon the approval of the MARINA have converted most passage areas to accommodate cargo instead and passage rates were also brought down to be competitive to that of low airfares just to maintain market share," she said.
Sy added that about 15 years ago, revenue from passage and cargo of Trans-Asia is at 50-50 ratio. Now, cargoes make up the bulk while passage has dwindled to about 35 percent only.
She however admitted that the riding public stands to gain the most with the operation of LCCs.
Meanwhile, some experts see the increasing global demand for no-frills travel as one of factors that contributed to the massive resignation of pilots of Philippine Airlines (PAL).
Flight Safety Inspectorate Service officer-in-charge and check pilot of the Civil Aviation Authority of the Philippines Capt. Jim Sydiongco said in a report that the growth of no-frills airlines may be good for commuters but not for the local aviation industry.
He said the problem faced by PAL is just a start of a graver problem not just for the company but the whole industry as well, if it is unable to compete with the higher salary and incentives dangled by foreign airline companies.
The increasing demand for no-frills, low-fare air travel has resulted in the recovery of the world's aviation industry after the three year economic uncertainty. This development would lead to the need for more pilots, mechanics, avionics experts and fitters, cabin crew and those in related jobs called "mission critical skils."
Boeing said the LCCs have fueled that demand, including the entry of new players in the market. There are 36 LCCs in Asia alone and their need for pilots and MCS is directly proportional to their growth. But the available heads, especially for aircraft captains, are limited so that these carriers often resort to poaching.
Sydiongco estimates local LCCs such as Cebu Pacific, Airphil Express, Sea air and Zest Air to have about a combined total of 1,000 pilots. They are vulnerable to poaching if their salaries and other perks are not on a par with those offered by foreigners. (THE FREEMAN)