PAL suspends NY flights

PAL suspends NY flights

MANILA (AFP): Philippine Airlines (PAL) said yesterday it
would suspend flights to New York from Sept. 2 because of
"staggering" losses resulting from restrictions imposed by US
aviation authorities.

PAL said in a statement the losses stemmed from a restriction
requiring the airline to use only aircraft, pilots and crew "wet-
leased" from a carrier designated by the US government.

Under so-called category two restriction, the US carrier,
World Airways, provides and charges PAL for the aircraft, crew,
maintenance and insurance costs. PAL also pays for the pilots
flying these leased planes.

"The U.S.- imposed category-two restriction serves to benefit
only the US-designated carrier and forces the Philippine carrier
into an insoluble catch-22 situation," PAL said in a statement.

It said management "decided to suspend the New York service in
view of the losses PAL is experiencing in operating these flights
using expensive and uneconomical wetleased aircraft from World
Airways, an American carrier."

PAL did not give a figure for the losses, but said they were
"staggering."