San Miguel Corporation to control PAL soon?

[windsong]

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there are perks and pros and cons gyud to tell you the truth local companies doesnt really give you any good its a advantage that other countries invest in our country since there are lots of BPO's or outsourced companies invested in our countries buying power of the filipinos increased .. by the way if PAL is bought by San miguel will it increase its price value?

[lhorenzoo]

really an advantage for smc purchasing Pal..but an uphill battle trying to make Pal profitable what with the high fuel costs . unsa na kahay mahitabo sa case ani sa pal against the employees union?

[xavisimao]

You see. PAL and Cebu Pacific may be competing but they are not of the same degree.

Cebu Pacific is a Low-Cost Carrier. LCCs are airlines that do not give you the same comfort and grandness as ordinary airlines but what they do offer is a cheaper airfare. That is what sets LCCs different from those ordinary airlines. They give you a lower fare but you'll have to sacrifice for the lesser expense. Like no snacks are offered for free unlike PAL, Cathay Pacific, Qatar Airways and such.

PAL is a flag carrier. Basically PAL, like any other airline offers a more expensive yet more luxurious and comfortable service than Cebu Pacific. It is just a competition on airfare really. And since Filipinos are generally poor, Cebu Pacific had the edge because first and foremost it is offering a way cheaper airfare than that of Philippine Airlines.

I beg to disagree on the argument that there is less competition in the local airline industry. There are as a matter of fact many local carriers operating in the Philippines. Cebu Pacific is considered as Asia's 3rd largest low cost carrier after Tiger Airways and AirAsia. Here are the lists of registered local airlines in the country:
List of airlines of the Philippines - Wikipedia, the free encyclopedia

There are six airlines that dominate the Philippine aviation industry. They are Cebu Pacific, Philippine Airlines, Airphil Express, Zest Air Seair and Spirit of Manila. Although, most of the local airline companies are categorized as low cost carriers while PAL is the flag carrier.

PAL also has a low-cost carrier airline that is meant to compete head-to-head with CEB which Airphil Express. Airphil Express is a low-cost version of PAL that was created to challenge the dominance of CEB in the domestic market.

Also, we must note that there is the foreign airline named AirAsia Philippines which is originates from Malaysia. They are also set to challenge both Airphil and CEB for dominance in the local and even on the world market share. Now, with all of these, I do not think the Philippine airline industry suffers no competition, there is, and it is a stiff competition. The Philippine market is growing steadily with more and more Filipinos being able to fly thanks to low-cost carriers and as competition intensifies then expect the airfare prices to go lower as time passes. There is more to the Philippines than what we usually think. Despite the protectionist constitution we have, we have a formidable economy that is insulated from the crisis in Europe. We are no longer the Philippines of the last decade, we are starting to regain the lost glory that we enjoyed in the good old days. What more if there will be constitutional reform? We might become another global power head-to-head with China, Japan, India and Indonesia. There is strength in numbers, if there is proper economic management on the part of the government.

per se, the so called "budget carriers" are still competitors with PAL.

if PAL don't have competitors of the same "level" then how come they are losing profit?

[leonell]

^ It is because of the LCC's. That is why PAL created Airphil Express. It cannot compete head-to-head with LCCs because of the big gap in cost. Remember that the domestic airline market is supported by a largely poor Philippines. PAL has competitors but are mostly foreign airlines. Local LCC' will screw PAL that is why they are losing profit. PAL cannot survive with the boom of LCC's that grabs a large share of the domestic market. They are not of the same level, PAL is not an LCC that is why Airphil Express is there to give PAL a leverage in its competition with other LCCs because PAL alone will not survive in a largely poorer Filipino market.

[Joseph20102011]

Foreign capitalists will benefit the market but will also badly affect the worker.

If there's no enough government regulation on them whether foreign or local capitalist exploit workers.

This is the primary premise on why Marx criticized western capitalism specifically during the industrial revolution in England.

The revolution that would have overthrown capitalism never happens as Marx predicted because the government in the capitalist societies in Europe and the United States provided socialistic legal protection like workplace safer, unemployment insurance, disability protection, social security, and universal health care (Europe only) and the workers satisfied mostly what the government of the capitalist societies give them and revolution of overthrowing capitalism never happens. Most intellectuals in Europe and the United States had learned a lesson from the French Revolution that overthrowing a status quo whether economic or political through violence is destructive and cost many lives so they reluctant to accept/participate Marx method of overthrowing the capitalism which means Marx predicted revolution of overthrowing capitalism has no chance of happening.

We cannot just open everything to them. Protect industries that are vital to the needs of the people like water, agriculture, energy and other important industries. It may be good that there are foreign investors but let us not forget that these foreign companies originate from another country and they are, as far as business attitude is concerned, influenced by their home country.

I don't care what's the citizenship of a particular investor as long as they can provide better services to the customers, can generate jobs for millions of unemployed Filipinos, can improve our infrastructure, and can make a technology transfer to our local firms through joint-ventures. It's fine for me. Any economic sector (except for the matters of national security) shall be open for investment to anyone regardless of nationality. Rule of Law shall be fair to any investor regardless of nationality.

It now becomes a matter of diplomatic leverage. For the sake of national security and freeing the country from possible economic pressures on vital industries, we must only allow local companies to enter. Not everything in the Philippine economy must be opened to foreign competition. That is something that needs more pondering and analysis before jumping into conclusions.

In the matters of national security like defense, foreign investment participation restrictions can be applicable.

For instance, Cambodia has opened up its economy to foreign capitalist. They sold their properties and land to foreign corporations and now most of the country is already owned by Chinese and Singaporean investors. But did the country become rich? No, they are worse than the Philippines. That is the effect of a rather reckless act of opening up everything to foreign capitalists. What we need is proper economic management to make sure that even as the Philippines is open to foreign investments, we are not left with the shorter end of the stick. We need to weigh things properly and decide which sectors should or should not be opened to foreign companies.

Cambodia is rapidly growing economy and emerging destination for foreign investments unlike us and in five years time, we will be surpassed by Cambodia and anyway in our country if we allow foreigners to own land, I don't think foreigners would buy the most of the Philippines because our country is mountainous, an archipelago, and densely populated unlike in US, Brazil, Argentina, Canada, and Australia where any foreigners in their respective countries can buy their respective empty lands.

[trollolol]

Yes, the protectionist constitution is really one big obstacle to full economic prosperity. I would even advocate a reform on the constitution it's just that the current political system in the Philippines is rather still shaky and fragile. I wanted to promote a Federal system for the country to make sure that every province gets their share of the investments and so there will also be competition between LGU's and make us more competitive. But what worries me is if the other provinces are capable of carrying the burden of standing alone in the federation. For instance, if we transform to a federal union, provinces like Lanao, and most provinces in Mindanao might not survive the stiff competition that comes out of every other province as they try to best each other. They are not yet financially capable to stand on their own. This is a bane for the country's economy. Because we cannot transform unless everyone is ready for it. Cebu is lucky, it can survive on its own if ever we become federal. Cebu is supported by commerce, trade, industry, export and outsourcing. We are financially strong compared to the rest of the country. but what of the others? I think we'll have to prepare them first and not rush into something that may become an omen in the future. What is thought of as a great dream may become a nightmare if we rush things up.

Foreign capitalists will benefit the market but will also badly affect the worker. This is the primary premise on why Marx criticized western capitalism specifically during the industrial revolution in England. We cannot just open everything to them. Protect industries that are vital to the needs of the people like water, agriculture, energy and other important industries. It may be good that there are foreign investors but let us not forget that these foreign companies originate from another country and they are, as far as business attitude is concerned, influenced by their home country. It now becomes a matter of diplomatic leverage. For the sake of national security and freeing the country from possible economic pressures on vital industries, we must only allow local companies to enter. Not everything in the Philippine economy must be opened to foreign competition. That is something that needs more pondering and analysis before jumping into conclusions.

For instance, Cambodia has opened up its economy to foreign capitalist. They sold their properties and land to foreign corporations and now most of the country is already owned by Chinese and Singaporean investors. But did the country become rich? No, they are worse than the Philippines. That is the effect of a rather reckless act of opening up everything to foreign capitalists. What we need is proper economic management to make sure that even as the Philippines is open to foreign investments, we are not left with the shorter end of the stick. We need to weigh things properly and decide which sectors should or should not be opened to foreign companies.

I am really not an advocate of federalism only because there is so much I don't know about it. I am wondering why you made mention of it when the message I really tried to get through was about our restrictions on foreign capital/investors.

You only need to look at our dismal record at managing industries limited to locals only to see my point. Take for example those you specifically mentioned:

Water = Water is very expensive. Locators in MEPZ complain about the lack of and price of water. There has been talk of drought in the province unless water sources are tapped like that in Compostela. Ayala wants to capitalize and tried pulling some muscle in the Water District speculating talks of corruption. Foreign companies are very sensitive to corruption charges. Pacquiao even cried when he lost endorsement deals in the US merely on suspicion he was a tax evader thousands of miles away.

Agriculture = Ownership of viable land for production is limited to a few families. Local produce cannot even compete with imports in terms of price and quality. The top rice research institute is in the country but we have become a rice importing country.

Energy = Highest electricity rates in Asia. Need I say more?

Cambodia is a poor example since the law allowing foreigners to own property is recent and somewhat as what I know limited to condo units (which by the way is no different to ours). Try those who have been doing it for years like Malaysia, Thailand, Korea, Singapore, and Taiwan. Still I find it hard to believe that your claims regarding foreign property ownership in Cambodia are not exaggerated. Please cite a source since I am intrigued by what you say.

[xavisimao]

^ It is because of the LCC's. That is why PAL created Airphil Express. It cannot compete head-to-head with LCCs because of the big gap in cost. Remember that the domestic airline market is supported by a largely poor Philippines. PAL has competitors but are mostly foreign airlines. Local LCC' will screw PAL that is why they are losing profit. PAL cannot survive with the boom of LCC's that grabs a large share of the domestic market. They are not of the same level, PAL is not an LCC that is why Airphil Express is there to give PAL a leverage in its competition with other LCCs because PAL alone will not survive in a largely poorer Filipino market.

so in that case, the "LCC" market is still the competition of PAL, right?

can you cite a written evidence that PAL is not catering to the masses or middle-class citizens, and only they're after is for the rich and the powerful?

PAL lost profit due to surging operational costs, labor strikes and competitors alike

[joop]

for sure SanMigLyt will be one of the choices inside MabuhayLounge fridge then? tired of having Colt, bring on SanMig beers pls,lol

[MetalManiac]

Smc is making a crucial decision in buying Pal. will this be a good decision ? lets see in the long haul.

[DailyCore]

If ever SMC takes full control, perhaps PAL can push through with its delayed plans of buying new planes. Lucio Tan previously expressed interest in buying an A380 to enhance PAL's Philippines-USA service.