Philippine Air to cut baggage allowance, save on fuel
MANILA, Aug 28 (Reuters) - Philippine Airlines PHL.UL announced on Thursday it would cut back on free baggage allowed for passengers on trans-Pacific routes to save on fuel costs, which are eating into its revenues.
Chief Financial Officer Andrew Huang told reporters that 50 pounds (23 kg) of free baggage would be allowed for each passenger travelling to or from the United States against an earlier allowance of 70 pounds.
The airline is also reducing the amount of water it carries on board, and lowering the food choices on offer during flights to cut back on weight.
"These initiatives will improve our situation by $20-30 million, or probably in the vicinity of $30 million or more a year at the current price of fuel," Huang said.
Philippine Airlines, a subsidiary of PAL Holdings Inc (PAL.PS), posted a 77 percent drop in net income at $30.6 million in the fiscal year ending March.
It has said net income in this year may be lower than in 2008/09.
"It is very difficult to give forward-looking statements because our costs are heating up," Huang said.
"Our revenues will still grow although at a much slower pace than our expenses are growing," he added. (Reporting by Raju Gopalakrishnan; Editing by Louise Heavens)
